WTI rallies sharply on Strait of Hormuz tensions, technicals point to further upside

West Texas Intermediate (WTI) crude Oil continues to experience extreme volatility, with prices rising more than 7.5% on Thursday as traders grow increasingly concerned about prolonged supply disruptions through the Strait of Hormuz amid the ongoing US-Iran war.

At the time of writing, WTI is trading around $94.31, extending gains for the third consecutive day after Monday’s sharp two-way price swings, when the US benchmark briefly surged to $113 before reversing and closing near $83.36.

Iran’s new Supreme Leader, Mojtaba Khamenei, said on Thursday that the closure of the Strait of Hormuz should continue as a tool to pressure Iran’s enemies.

Meanwhile, US Energy Secretary Chris Wright said the world is facing a significant short-term supply disruption and that Washington will work with other nations to restore tanker traffic through the strategic waterway, adding that US Navy escorts for oil tankers could begin by the end of the month.

Separately, the International Energy Agency (IEA) announced plans to release around 400 million barrels of Oil from its members’ strategic reserves to stabilize markets, though the move did little to calm fears of supply shortages.

The agency warned that the Middle East war is creating the largest supply disruption in the history of the global Oil market, while also lowering its 2026 global Oil demand growth forecast to 640,000 barrels per day from 850,000 bpd previously.

From a technical perspective, the daily chart shows WTI accelerating higher above the rising 21, 50 and 100-day Simple Moving Averages (SMAs), highlighting strong bullish momentum.

The Relative Strength Index (RSI) is holding deep in overbought territory near 81, suggesting stretched upside conditions but not yet signaling a clear reversal. Meanwhile, the Average Directional Index (ADX) is climbing toward the high-40s, pointing to a strong and strengthening trend, while the rising Average True Range (ATR) reflects elevated market volatility.

On the upside, immediate resistance is seen at the 50% Fibonacci retracement near $94.61, measured from the $113.28 high to the $75.95 low. A sustained move above this level could open the door toward the 61.8% retracement at $99.02.

Further strength may target the 78.6% retracement near $105.29, while a deeper recovery could bring the focus back to the $113.28 peak, which marks the next major resistance zone.

On the downside, initial support emerges near the 38.2% Fibonacci retracement around $90.21, followed by the 23.6% retracement at $84.76 if overbought conditions trigger a correction. A deeper pullback could bring the Tuesday swing low near $75.95 (0% Fibonacci level) into focus, with additional support seen around the 21-day Simple Moving Average near $72.20.