WTI Crude oil: Substantial room for further deterioration – TDS

Energy markets are in a free-fall, with WTI crude prices reaching their lowest levels since 2002, as it is clear that they are facing both demand and supply shock, strategists at TD Securities apprise. 

Key quotes

“The 60d ma of all technical signals in our basket of 75 momentum and mean-reversion strategies, highlights that 19% of signals are short in WTI crude — suggesting substantial room for further deterioration.”

“Among the momentum signals alone, there remains substantial room for deterioration with only 33% of signals short.” 

“As Saudi Arabia boosts exports to a record high of 10m bpd, we suspect that the price war is here to stay — forming a downtrend that may outlast the virus' demand shock alone.”