On Thursday during Asian trading hours, US benchmark WTI crude oil continued its decline, falling for the second consecutive trading day, currently hovering around $87.50, very close to the near one-month low reached the previous day. The Democratic Party's victory in both the House and Senate in the midterm elections is the core driving factor behind this round of oil price correction. Democratic leader Schumer stated publicly that he would use Congress's control over government budget appropriations to pressure the White House to push for an end to the Iran conflict. The trading market reacted strongly to this, beginning to price in the possibility of a significant easing of the conflict, rapidly stripping away the geopolitical risk premium embedded in crude oil, leading to a significant drop in oil prices. However, the alarm bells surrounding Middle Eastern energy supplies have not been completely lifted. The Strait of Hormuz remains a major unresolved risk point in the energy market; any obstruction of the shipping lanes would directly impact global crude oil supply. Iran has stated that the US response to its conditions for reopening the strait is unsatisfactory, and a significant gap remains in negotiations. Recently, another oil tanker was attacked off the coast of Oman near the Strait of Hormuz. These repeated attacks have reignited market concerns about regional shipping security, limiting the downside potential of oil prices to some extent. On the other hand, the overall weakening of the US dollar index has indirectly supported dollar-denominated crude oil, alleviating some of the selling pressure. WTI crude oil has experienced a sharp pullback from its May high of $104 last Friday, with a substantial decline. It is premature to confirm a price peak at present; sustained selling pressure is needed to further confirm the trend. Geopolitical tensions could resurface at any time, and news events could easily reshape short-term price movements. The market will continue to closely monitor two key factors: first, the dynamics of US-Iran diplomatic negotiations and shipping security in the Strait of Hormuz, as sudden attacks or breakthroughs in diplomacy could lead to significant oil price volatility; second, subsequent US employment data, as changes in the strength of the US dollar will indirectly impact crude oil prices. Given the rapidly shifting geopolitical sentiment, crude oil prices are expected to remain highly volatile throughout the day. On the daily chart, WTI crude oil has fallen sharply from its recent high, currently testing the 100-day simple moving average at 86.11, which coincides with the 50% Fibonacci retracement level of this upward move at 85.59. These two levels form a significant support level. This support zone represents a concentrated area of buying during the recent pullback; if this level holds, there is still a possibility of a rebound after the recent correction. If the price breaks below the confluence of support levels at 85.59 and 86.11, the downside potential for oil prices will open up further. The next key support level to watch is the 61.8% Fibonacci retracement at 81.27, followed by the 78.6% retracement at 75.12, and then the previous swing low at 67.29. On the upside, the first resistance level is the 38.2% Fibonacci retracement at 89.91, followed by the 23.6% retracement at 95.25, with strong resistance at the current cycle high of 103.89. Only a sustained move above 89.91 will alleviate short-term bearish pressure. On the 4-hour chart, the moving averages are turning downwards, prices are continuing to decline, and the RSI indicator has fallen to the neutral-to-low range, not yet reaching deep oversold territory, indicating further downside potential. Until the price reclaims the 89.91 level, the short-term market will remain in a pullback pattern. The key focus will be on the battle between bulls and bears around the 85.59-86.11 support zone. Editor's Summary: The recent decline in crude oil prices was primarily driven by the market's pricing of a easing of tensions between the US and Iran following the midterm elections, leading to a rapid reduction in geopolitical risk premiums. However, the repeated attacks on oil tankers in the Strait of Hormuz indicate that supply risks have not been completely eliminated. Coupled with a weakening US dollar, this has created a two-way pull on oil prices. Short-term risks lie in significant progress in diplomatic negotiations, potentially leading to further price declines. A potential opportunity is a renewed deterioration in the Middle East situation, disrupting shipping and driving a rapid return of risk premiums, resulting in a price rebound. Close attention should be paid to the support level of 85.59-86.11, and caution should be exercised against significant volatility driven by geopolitical factors.