Key Moments
- WTI trades just under $83.00 in Asian dealings on Wednesday, extending its three-day advance and hovering near a nearly two-week peak.
- Geopolitical tensions around the Strait of Hormuz and fresh Houthi attacks in the Red Sea continue to stoke supply concerns and support prices.
- From a technical standpoint, WTI remains above the 38.2% Fibonacci retracement of the July-August decline, with momentum indicators signaling a constructive bullish bias.
Geopolitical Tensions Bolster WTI Prices
West Texas Intermediate (WTI), the key US crude oil benchmark, continues to attract buying interest for a third consecutive session, with prices trading just shy of the $83.00 level during Asian hours on Wednesday. The contract is holding close to the almost two-week high reached in the prior session.
Market participants are closely watching developments in West Asia. An advisor to Iran’s Supreme Leader Mojtaba Khamenei stated on Tuesday that the Strait of Hormuz will not be opened until the US meets Tehran’s demands. At the same time, renewed strikes by Yemen’s Iran-backed Houthi group against shipping in the Red Sea are amplifying worries about potential supply disruptions in the region.
These geopolitical risks are providing a supportive backdrop for crude, reinforcing expectations that prices could extend their near-term upward move.
Technical Picture: Bulls Maintain Upper Hand
On the technical front, WTI is trading above the 38.2% Fibonacci retracement of the July-August downswing, signaling that buyers remain in control and that the short-term trend is skewed to the upside.
The Relative Strength Index (14) stands at 64.63, staying in positive territory without yet reaching overbought conditions. Meanwhile, the Moving Average Convergence Divergence (MACD) indicator shows the MACD line in positive territory, underscoring that upside momentum remains intact.
Key Fibonacci Levels in Focus
With momentum indicators supportive, the price structure highlights several nearby resistance and support levels derived from Fibonacci retracement calculations of the recent slide.
| Level Type | Fibonacci Level | Price | Significance |
|---|---|---|---|
| Resistance | 50% | $82.93 | Next immediate upside hurdle |
| Resistance | 61.8% | $85.13 | Further resistance if rally extends |
| Resistance | 78.6% | $88.27 | Higher barrier on continued bullish move |
| Resistance | Prior cycle high | $92.26 | Key reference high from previous upswing |
| Support | 38.2% | $80.73 | First notable downside support |
| Support | 23.6% | $78.00 | Secondary support on deeper pullback |
| Support | Swing low | $73.60 | More distant structural floor |
Given the current posture above the 38.2% retracement, a move toward the 50% level at $82.93 is presented as a realistic near-term scenario. Should bullish momentum persist, the 61.8% marker at $85.13 and the 78.6% retracement at $88.27 come into view, before the prior cycle high at $92.26.
On the downside, the first layer of technical support is identified at the 38.2% Fibonacci retracement at $80.73. Below that, the 23.6% retracement at $78.00 is the next reference point, while a more pronounced correction would bring the $73.60 swing low into focus as a key structural support.
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