Crude oil remains capped by renewed US-Iran deal hopes, but upside risks persist

Crude oil continues to consolidate around weekly highs as renewed prospects for a US-Iran deal helped limit the upside. Just earlier, Semafor reported that the Trump administration is involved in discussions aimed at securing a temporary peace deal with Iran. Vice President JD Vance has reportedly sent a letter to Tehran in an effort to revive negotiations.An administration official told Semafor that US forces could resume combat operations shortly after the midterm elections, with the military reportedly requiring only presidential authorization. However, several officials remain sceptical about escalating the conflict, while Trump is reportedly the most open to military action, despite still having reservations.Meanwhile, the Saudi-Houthi conflict continues which adds to upside risks. All in all, the market remains supported amid the Middle East tensions and the possibility of another US attack after the US midterm elections. We would need a de-escalation in the Saudi-Houthi conflict or a surprising breakthrough in US-Iran negotiations to get a significant correction in oil prices. CRUDE OIL TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that crude oil(CFD contract) has been consolidating around recent highs for almost a week as we’ve started to see a stronger push for US-Iran deal. Technically, there’s not much we can glean from this timeframe as the most important levels remain the lower bound of the channel and the resistance around the 110.00 level, so we need to zoom in to see some more details.CRUDE OIL TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we have the upward trendline defining the bullish momentum. The buyers continue to lean on the trendline, with a defined risk below it, to keep pushing into new highs. The sellers, on the other hand, will want to see the price breaking lower to pile in for a correction into the lower bound of the channel.CRUDE OIL TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, there’s not much we can add here as the choppy price action could lead to many fakeouts. The buyers continue to have a better risk to reward setup around the trendline, while the sellers will need a break below it to open the door for new lows. The red lines define the average daily range for today. UPCOMING CATALYSTSTodaywe get the US GDP report, the US PCE and the latest US Jobless Claims figures. Tomorrow, we conclude the week with the US Employment Cost Index. The focus will remain on the Middle East developments. This article was written by Giuseppe Dellamotta at investinglive.com.