- WTI regains positive traction on Tuesday as geopolitical uncertainties remain in play.
- Hopes for Iran diplomacy might keep a lid on any meaningful upside for the commodity.
- The constructive technical setup suggests that corrective pullbacks could be bought into.
West Texas Intermediate (WTI) – the benchmark US Crude Oil price – attracts some dip-buyers during the Asian session on Tuesday, reversing a part of the previous day’s heavy losses to the $94.30 area, or an over two-week low. The commodity currently trades above the $96.00 mark, up over 1.0% for the day, amid mixed developments surrounding the Middle East crisis.
In fact, several days of negotiations between Iranian officials and Qatari mediators failed to make a major breakthrough despite Tehran’s revised proposals to reopen the strategic Strait of Hormuz for two days. This keeps the geopolitical risk premium in play and offers some support to the black liquid. Meanwhile, discussions between the US and Iran reportedly are still ongoing. Furthermore, US President Donald Trump said on Monday that Iran wants to make a deal to end the war and that such an agreement could happen.
Adding to this, Iran’s President Masoud Pezeshkian said that Tehran is seeking to resolve problems through dialogue. This fuels optimism over a potential diplomatic resolution to end the eight-month war, which might keep a lid on any meaningful upside for crude oil prices. Hence, it will be prudent to wait for strong follow-through buying before placing fresh bullish bets on the commodity and positioning for the resumption of the commodity’s recent well-established upward trajectory witnessed over the past four months or so.
From a technical perspective, the black liquid holds a bullish near-term bias above all key Fibonacci retracement supports, with the 23.6% level at $95.18 now acting as an immediate floor. That said, momentum indicators are more cautious, as the Relative Strength Index near 50.0 hints at neutral pressure and the Moving Average Convergence Divergence (MACD) has slipped marginally negative. This suggests the latest pullback is more a consolidation than a trend reversal while crude oil prices stay above these underlying levels.
Meanwhile, the next significant resistance is the recent cycle high/Fibonacci anchor at $103.87, and a decisive break above this barrier would reopen the path for an extension of the prevailing bullish trend. On the downside, initial support is seen at the 23.6% Fibo. retracement at $95.18, followed by a broader demand cluster around the 38.2% retracement at $89.81 and the 100-day SMA at $85.86, with the adjacent 50.0% retracement at $85.46 reinforcing that medium-term base. Deeper declines would expose the 61.8% retracement at $81.12 and then the lower Fibonacci layers at $74.93 and $67.05.
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