West Texas Intermediate (WTI) crude oil prices rebounded partially on Friday, trading around $83.80 per barrel after recovering from an intraday low of $81.80, which marked the lowest level since April 17 [1]. The recovery followed heavy selling pressure on Thursday, triggered by comments from US President Donald Trump suggesting that the US and Iran could sign a peace deal as soon as this weekend, potentially reopening the Strait of Hormuz—a vital passage for approximately 20% of global oil flows [1]. Despite these developments, uncertainty persists regarding the future management of the Strait. According to IRNA, the administration of the Strait will be resolved regionally through dialogue and joint decision-making between Tehran and Oman, and the proposed agreement does not require Iran to transfer control of the strategic waterway [1].
Until more details about any agreement emerge, a geopolitical risk premium is expected to remain embedded in oil prices [1]. From a technical perspective, WTI maintains a bearish near-term bias, with prices trading below the 100-, 50-, and 21-day simple moving averages (SMAs), which are clustered between roughly $85 and $94 and are likely to cap any recovery attempts [1]. The Relative Strength Index (RSI) on the daily chart is near 39, indicating a downside bias in momentum, while the subdued Average Directional Index (ADX) around 14 suggests a weak directional trend [1].
Key resistance levels are identified at the 100-day SMA at $85.23, the 21-day SMA near $92.17, and the 50-day SMA around $93.70, where sellers are expected to re-emerge if prices attempt a further bounce [1]. On the downside, immediate support is seen at the $80 psychological mark, followed by the 200-day SMA at $72.49 [1].
Overall, while the market is reacting to geopolitical headlines, technical indicators point to continued weakness in WTI prices unless a significant catalyst emerges [1].
CONCLUSION
WTI oil prices have stabilized after a sharp decline, driven by speculation over a potential US-Iran agreement and ongoing uncertainty about the Strait of Hormuz. Technical analysis suggests a bearish outlook persists, with key resistance levels capping recovery attempts and downside momentum prevailing. Market participants are likely to remain cautious until further clarity on geopolitical developments emerges.