FX.co ★ CL/Crude Oil

West Texas Intermediate (WTI) crude futures, the benchmark for US crude, faced renewed selling pressure in Asian trading on Thursday, giving back some of the gains made the previous day, but remained above the psychologically important $88 level and above its lowest point in nearly four weeks. Market participants are closely monitoring geopolitical developments in the Middle East. A key factor weighing on crude prices is the continued return of regional logistics to normal, particularly the steady recovery of traffic through Saudi Arabia’s East-West oil pipeline. However, the ongoing confrontation between the US and Iran continues to maintain a high level of geopolitical risk, potentially providing support for crude prices and limiting further declines. Previous reports that President Trump rejected Tehran’s seven-day peace proposal significantly diminished hopes for an immediate diplomatic resolution to the conflict. Moreover, political rumors suggesting the US government is expected to launch a large-scale military operation against Iran after the upcoming midterm elections in November, and the possibility of resuming strategic bombing, have heightened market concerns about supply. Technically, crude oil prices failed to hold above the key 200-period simple moving average on the four-hour chart overnight, resulting in a sharp reversal that undoubtedly benefits short sellers. Technical momentum indicators reflect this continued caution: the Moving Average Convergence Divergence (MACD) remains in negative territory and is trending slightly lower; while the 14-period Relative Strength Index (RSI) hovers around 38, suggesting continued bearish momentum rather than a clear reversal in oversold territory. Despite these mounting technical resistances, crude oil prices found temporary support near the 50% Fibonacci retracement level around $87.75, a key pivot point being closely watched by market participants. A sustained break below the current low would expose deeper structural support levels at the 61.8% Fibonacci retracement level around $84.37 and the 78.6% Fibonacci retracement level around $79.56, and could ultimately threaten the overall cycle low around $73.44. On the upside, initial technical resistance is centered around the 200-period moving average near $90.11, with subsequent resistance at the 38.2% Fibonacci retracement level near $91.13, which has successfully halted previous bounce attempts. Meanwhile, for a stronger and more convincing upside move, a break above the 23.6% Fibonacci retracement level near $95.31 is needed to reverse the overall technical pattern and give buyers the upper hand.