23.6% Fibo. and 200-hour SMA: WTI Price Forecast favours bears below both

Mixed fundamental signals leave WTI struggling to extend the previous day’s gains.
Rising output and prospects of a Russia-Ukraine ceasefire weigh on crude prices.
Despite support from Middle East uncertainty, the technical outlook remains tilted towards the bears.

West Texas Intermediate (WTI), the US Crude Oil benchmark, dips in Friday’s Asian session. Selling lacks follow-through, however, as traders wait for fresh developments in the Middle East crisis.

Expectations persist among investors that behind-the-scenes efforts could deliver a Russia-Ukraine ceasefire. With the US-China summit due next week, a lower risk of further escalation in Middle East tensions also leaves crude unable to build on the previous day’s advance. US officials recently played down the need for additional military strikes against Iran. Meanwhile, rising OPEC+ output and increased production in Saudi Arabia and Iraq help limit oil prices.

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Geopolitical risk premiums have nevertheless returned following a fresh warning from US President Donald Trump to Iran. Trump said those responsible for any attack on American officials would no longer exist. Crude also draws support from attacks on Saudi Arabia’s energy infrastructure and the US-Iran confrontation over the Strait of Hormuz. Mohammad Bagher Ghalibaf, Iran’s parliament speaker and top negotiator, said the vital waterway would never revert to its status before the US-Israel war on Iran.

At $88.04, the 23.6% Fibonacci retracement remains above crude prices, as does the 200-hour Simple Moving Average (SMA) near $89.18. Momentum indicators point to continued difficulty in clearing overhead resistance, reinforcing the near-term bearish outlook. The signals are mixed in detail: a Relative Strength Index (RSI) reading of 60.75 indicates mildly positive momentum, whereas the Moving Average Convergence Divergence (MACD) is levelling off just below zero.

The first upside hurdle is the 23.6% Fibonacci retracement at $88.04, ahead of the 200-period SMA at $89.18. Further resistance sits at the 38.2% retracement around $91.11 and the 50.0% level at $93.60. The cycle low around $83.06 provides the main structural support. A breach of that area would likely strengthen the prevailing bearish bias. By contrast, sustained trading above $87.00 but below $88.04 would leave crude consolidating within a range skewed to the downside.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

1-hour WTI chart

WTI Oil: Key Questions

WTI Oil: Definition and Characteristics

Traded internationally, WTI Oil is a grade of crude whose initials stand for West Texas Intermediate. It is one of three major crude types, alongside Brent and Dubai Crude. Its relatively low gravity and sulphur content account for the descriptions “light” and “sweet”, respectively. This high-quality oil is considered easy to refine. Produced in the United States, it is distributed through the Cushing hub, known as “The Pipeline Crossroads of the World”. WTI serves as an oil-market benchmark, with its price regularly cited in media coverage.

WTI Oil: Main Price Drivers

Supply and demand underpin WTI Oil prices, as they do for other assets. Stronger global growth can lift demand, while weaker growth can have the reverse effect. Supply disruptions caused by political instability, wars or sanctions can also move prices. Another major influence is OPEC, the group of leading oil-producing countries, through its production decisions. Currency movements matter too: oil is traded predominantly in US Dollars, so a weaker US Dollar can make WTI Crude Oil more affordable, while a stronger currency can have the opposite effect.

WTI Oil: The Impact of Inventory Data

WTI Oil prices respond to weekly inventory releases from the American Petroleum Institute (API) and the Energy Information Agency (EIA). Stock changes reveal shifts in the supply-demand balance. Falling inventories may signal stronger demand and lift oil prices; rising stocks may indicate greater supply and weigh on prices. The API publishes its report every Tuesday, followed by the EIA the next day. The two releases tend to show similar results, with readings within 1% of each other 75% of the time. As the EIA is a government agency, its figures are regarded as more reliable.

12 Oil-Producing Nations: OPEC’s Influence on WTI Prices

At meetings held twice a year, the 12 oil-producing nations in OPEC (Organization of the Petroleum Exporting Countries) jointly set production quotas for member countries. Those decisions frequently influence WTI Oil prices. Lower quotas can restrict supply and drive prices higher, whereas increased OPEC production has the reverse effect. The broader OPEC+ group brings in ten additional non-OPEC members, with Russia the most prominent.