FX.co ★ CL/Crude Oil

West Texas Intermediate (WTI) crude oil futures suffered continued selling pressure for the second consecutive session, falling below the key psychological level of $100 per barrel during Asian trading on Tuesday. Despite the immediate pullback, energy futures remained near their five-month highs reached late last week, as market participants remained cautious amid evolving geopolitical tensions in the Middle East. Optimism surrounding the potential for a diplomatic de-escalation of hostilities between the US, Israeli, and Iranian militaries temporarily eased concerns about supply disruptions, putting downward pressure on energy prices. However, a significant geopolitical risk premium remains embedded in energy contracts due to stalled bilateral negotiations between Washington and Tehran and the ongoing drone and missile attacks on critical energy and transportation infrastructure in Saudi Arabia by the Iranian-backed Houthi rebels. Furthermore, intelligence reports indicate that Hezbollah's armed forces in Lebanon are actively preparing for another potential border conflict with Israel, which continues to undermine short-term regional stability and provides structural support for aggressive selling in black market transactions. In addition to the immediate supply dynamics in the Middle East, energy markets face a complex global macroeconomic environment characterized by sophisticated response mechanisms from central banks and extensive inventory considerations. Continued energy price volatility complicates inflation forecasts from major monetary authorities, including the Federal Reserve, the European Central Bank, and the Bank of England, and reinforces expectations that global borrowing costs will remain constrained for an extended period to mitigate the transient effects of secondary inflation. Since higher crude oil prices directly drive up refined product and transportation costs, private sector purchasing managers' indices (PMIs) in major industrialized economies reflect the resilience of input price indices, potentially creating headwinds for consumer demand. However, limited global physical inventories, coupled with ongoing supply management by OPEC+ producers, continue to offset aggregate demand concerns, ensuring that market fundamentals remain tight as we approach the fourth quarter. Based on technical analysis of the 4-hour chart, West Texas Intermediate crude oil maintains a positive short-term uptrend, firmly holding above the 100-period simple moving average (SMA) and key Fibonacci retracement levels derived from the overall rally from $86.58 to $103.39. Momentum indicators suggest that prices are experiencing a temporary cooling-off phase rather than a structural trend reversal; the 14-period Relative Strength Index (RSI) has declined to a neutral value of 50.69 from previous overbought territory, while the Moving Average Convergence Divergence (MACD) has dipped slightly into negative territory, indicating that prices are in a short-term consolidation phase within the overall uptrend. Immediate dynamic support consists of the 23.6% Fibonacci retracement level at $99.42, followed by the 38.2% Fibonacci retracement level at $96.97, and the 50.0% Fibonacci retracement level at $94.98, which coincides well with the 100-period simple moving average (SMA) at $94.74, creating a strong barrier to demand. If selling pressure intensifies, a deeper decline would encounter the 61.8% Fibonacci retracement level at $93.00 as secondary technical support, with a lower structural target at $90.18 and a major swing low at $86.58. Conversely, on the upside, immediate dynamic resistance lies near the round number mark at $100.00. A sustained close above this baseline on the 4-hour K-line would revive bullish momentum and create a clear technical path for buyers to target the recent high near $103.39. A break above the swing resistance at $103.39 would be crucial for buyers and would help confirm the continuation of the multi-week uptrend that began earlier this month. As long as the key Fibonacci support range remains intact, the overall medium-term market bias will continue to favor higher prices.