WTI Crude Oil Price Forecast: $73.25 Support Tested as Post-Treaty Volatility Fuels Oversold 2H Channel Squeeze

Quick overview

West Texas Intermediate (WTI) managed to put together a short-lived support setup in the mid-afternoon on June 23, 2026, halting its heavy down-leg trade at $73.76, +0.20% as commercial desks digest the ongoing normalization of shipping routes, coupled with the continued presence of a much more restrictive domestic monetary policy stance.

Islamabad MOU Normalizes Hormuz Shipping

With the ratification of the U.S.-Iran interim peace treaty (officially the “Islamabad Memorandum of Understanding”), the key fundamental that is now underpinning the commodity supply rebalancing is the ongoing normalization of maritime shipping across the region. Following the border-crossing deal signed June 19 in Switzerland, commercial shipping through the Strait of Hormuz quickly stabilized, currently sitting at 85% of pre-crisis volumes.

Now that the risk of sudden supply cutbacks has largely subsided, traders are increasingly turning their attention to physical barrels. Iranian crude exports are already ramping up into international trade flows at a brisker clip, coinciding with OPEC+’s planned 188K barrel per day supply increase for July.

In the presence of this added global supply, and alongside record-high domestic production numbers on home soil, a strong near-term price rise for WTI will be unlikely.

Warsh Fed Confirms Higher-For-Longer Tightening

Demand expectations are likewise evolving given the strict, rules-based monetarist strategy laid out in the FOMC meeting June 16, 2026 to June 17, 2026, the first of the Warsh Fed. Facing a 4.1% core CPI print (year-over-year) in April and a hot 3.8% inflation rate, Fed Chair Warsh elected to prioritize the fight against inflation, maintaining the Federal Funds Target Range in the 3.50% to 3.75% range.

In a decisive policy departure from past Fed practice, the Chair omitted all references to past dovish forward guidance and modified the Summary of Economic Projections’ (SEP) “dot plot” to reflect near unanimous Committee member views that interest rates will remain stable or rise in 2026. As a result, a robust bid for U.S. Treasuries real yields and the U.S. Dollar Index has developed.

This higher-for-longer capital costs regime remains a major headwind for the WTI price as foreign buyers face increased financing costs for dollar-denominated oil transactions and the overall demand outlook for energy consumption in large industrialized nations has worsened.

WTI Crude Holding the Bottom of 2H Descending Channel

Moving to the 2H chart, we can see that WTI’s retracement is confined to a very tight descending channel.

• Channel Formation: Oil ($73.76) is adhering to this key descending channel, bouncing off Point D’s lower edge. A clear institutional distribution is taking over, as price is trading way below the 2H EMA50 at $75.96 and the 2H EMA200 at $83.67.
• RSI is finding support: RSI(14) has settled at 40, showing a heavy extension by sellers. While it’s in oversold territory, MACD is stabilizing with a falling histogram, as the speed at which price is falling appears to be slowing at important levels.
• Trade Strategy: Traders will be best served with these key technical levels to consider:

1. Bullish Buy the Bounce: The price has reached the bottom of this channel at $73.23, which may be an excellent place for traders to buy. Place a stop under $69.90. Expect the first rally target to reach $75.96 and the next to be at $78.07.
2. Bearish Buy the Rally: Traders looking to sell should wait on relief rallies into $75.96 or $78.07 and short on weak volumes. A stop above $82.24 makes sense. Look for the price to fall below $67.05.

Crude is moving into a post-crisis era of oversupply. With this, the impending OPEC+ ministerial meeting remains as a vital wildcard in terms of output compliance, and, combined with the return of Iran’s exports and outside of OPEC production increase coupled with a hawkish, data-focused Federal Reserve under Chair Kevin Warsh, WTI is still structurally biased to a range-bound and modestly lower environment.

As time marches on towards the end of June, crude prices may well range-bound.

ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

AMZN Stock Drops 4.75% as Prime Day, FTC Ad Probe and $200B AI Capex Pressure Amazon

59 minutes ago

Save

Silver Price Forecast: Bears Threaten Core Trendline as XAG/USD Flushes into Deeply Oversold Territory

2 h ago

Save

Gold Price Forecast: Oversold $4,123 Trendline Defense Sets Stage for Tactical Relief Rally

3 h ago

Save