(WTI) Crude Oil Daily Outlook Update West Texas Intermediate (WTI), the crude oil benchmark, traded at $91.63 during Thursday's Asian trading session. West Texas Intermediate plunges on expectations that the US and Iran will make diplomatic breakthroughs. According to Reuters, Iran said on Wednesday that it is still ready for diplomacy to resolve the conflict between the US and Iran. However, they are still miles away from any resolution. An official said Tehran was still reviewing its response to the proposals. "Crude oil prices are going down because the markets have begun to unwind some of their geopolitical risk premiums due to the recovery in supply from the Gulf region and the prospects of an agreement between the US and Iran," Priyanka Sachdeva, Head of Market Insights, Phillip Nova Pte Ltd., stated. "However, the physical market is far from being fully normalized; therefore, there is still a high degree of sensitivity to headlines on the downside," she further added. US crude oil stocks surprised higher, adding to the downside for WTI. According to EIA data, the US crude oil stocks for the week ended September 18 increased by 2.969 million barrels as against a drop of 640,000 barrels in the previous week. According to TD Securities, the energy complex's current balance remains finely balanced, with threats from both sides. In particular, "TD Securities' strategists continue to believe that the current state of the energy complex is a double-edged sword, as if higher runs of refiners help loosen the product market but tighten the crude market or the rally in the crude breaks down because of higher flows without higher runs of refiners, leaving the product market to continue moving higher until demand destruction is discovered." However, at the same time, "the high flows through the Strait show a weakening in Iranian leverage power, and thus they may be more willing to make a deal, although the flows increase the risk of escalation in an effort to regain control." Looking at the day chart, WTI US Oil is bullish in the short term as prices stay above both the 100-day MA and the lower Bollinger Band. This suggests the broader bullish trend continues despite the current pullback from three-digit levels. Neutral momentum, as shown by the Relative Strength Index (14), is also evident, with the RSI near 51. From the buyers' point of view, the first resistance level is the middle Bollinger band and the 20-period SMA at $92.65, while the far-away upper Bollinger band at $101.95 will serve as resistance if bullish pressure resumes. On the other hand, the first support level is the 100-period MA at $84.95, and the second is the lower Bollinger band at $83.35.
