WTI Price Forecast: 20-day EMA acts as key barrier
- The oil price is under pressure as the month-long ceasefire between the US and Iran remains intact.
- US President Trump confirmed that the attacks exchanged near the Hormuz were not meant to resume the war.
- The US NFP data for April comes under the spotlight.
West Texas Intermediate (WTI), futures on NYMEX, is down 2.5% to near $92.20 during the European trading session on Friday. The Oil price faces selling pressure as the month-long ceasefire between the United States (US) and Iran remains intact after President Donald Trump confirmed that strikes exchanged near the Strait of Hormuz on Thursday were not meant to restart the war.
US President Trump said in an interview with ABC News, “It's just a love tap," when asked about the strike. Trump added that the ceasefire is not withdrawn and it is in effect. However, he reiterated the threat to attack Iran again if it doesn’t agree to the deal.
Meanwhile, Iran has not delivered any response to the one-page memorandum of understanding (MoU) delivered by the US as a peace proposal, which includes Tehran’s restriction on pursuing its nuclear ambitions.
Going forward, investors will focus on the US Nonfarm Payrolls (NFP) data for April, which will be published at 12:30 GMT. Investors will pay close attention to the US NFP data to get fresh cues on the Federal Reserve’s (Fed) monetary policy outlook.
WTI technical analysis
WTI US Oil trades lower at around $92.20, holding a bearish near-term bias as it remains below the 20-day exponential moving average (EMA) at $95.31. The location of price under this short-term trend gauge suggests rallies are likely to face selling interest, while the Relative Strength Index (RSI) at 47.54 hovers just below the neutral 50 line, hinting at fading bullish momentum rather than an outright oversold condition.
On the topside, initial resistance is defined by the 20-day EMA at $95.31, and a daily close above this barrier would be needed to ease immediate downside pressure and open the way for a more sustained recovery towards $100. Looking down, the oil price could slide towards the April 20 low of around $85.00 if it fails to hold the May 6 low of $86.92. A downside move below $85.00 would expose it to the April 17 low of $78.88.
(The technical analysis of this story was written with the help of an AI tool.)
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.