WTI corrects to near $100 as focus shifts to key policy decisions

• The Oil price corrects to near $100.00 from its five-month high of $103.28.
• The Fed, the ECB and the BoJ are expected to leave interest rates unchanged this week.
• Oil prices to remain firm as escalation risk ahead of Israeli elections and US midterm elections remains elevated.

West Texas Intermediate (WTI), futures on NYMEX, retreats from its five-month high of $103.28 to near $100 on Monday. The oil price comes under pressure as investors turn cautious ahead of key monetary policy announcements from a number of global central banks.

Central bank trio in focus as markets eye unchanged rates before later hikes

Analysts at Danske Bank highlight that, for the remainder of the week, market attention will be firmly on upcoming policy meetings, with “focus turns to interest rate decisions from the Fed on Wednesday, the ECB on Thursday and the Bank of Japan on Friday.” The bank notes that it “expect all three to keep interest rates unchanged before resuming rate hikes later this year,” underscoring a near-term pause in policy tightening even as the broader narrative remains one of further increases ahead.

Last week, oil prices gained significantly amid fears of fresh escalation in tensions between the United States (US) and Iran. Financial markets turned cautious after the US State Department called for a wider withdrawal of US diplomatic personnel from the Gulf.

What to expect from oil prices going forward?

According to TD Securities, crude prices remain biased higher in the near term, with analysts warning that “we expect crude oil will remain skewed to the upside in the near term as escalation risk ahead of Israeli elections and US midterm elections remains elevated.” They note that “recent Houthi strikes have seen risk premium pricing in the market increase, while persistent tanker attacks by Iran appear to have been successful in reducing some Hormuz flows,” reinforcing the geopolitical premium embedded in current pricing.

WTI Technical Analysis

In the daily chart, WTI US Oil trades at $100.51. The contract maintains a bullish near-term bias as price holds well above the 20-day Exponential Moving Average (EMA), currently at $95.68, suggesting the uptrend remains supported despite recent consolidation. The Relative Strength Index (RSI) at 62.99 stays in bullish territory but below overbought levels, hinting that upside momentum is positive yet not extreme.

On the downside, initial support is seen at the $100.51 area as an immediate pivot, with stronger underlying demand emerging near the 20-day EMA at $95.68 should a deeper pullback unfold. With no nearby technical resistance levels flagged by the current dataset, traders may continue to focus on how price behaves above these supports to gauge whether the bullish structure can extend or whether a corrective phase develops.

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