Copper is falling, iron ore is falling, oil prices are falling & volatility is trending higher. Furthermore, stocks are pressured and the AUD is weak. The warning signs are here for a deeper correction in risk. So, with many analysts considering a correction in stock markets due and rising COVID-19 cases in the Asia Pacific Region is this a great time to look for a medium-term oil short? The seasonals certainly lean towards selling over the course of the next month.
Over the last 15 years, US oil has fallen 60% of the time between August 29 and November 12 with an average loss of -6.95%. The largest gain was in 2007 with a 30.71% gain. The largest loss was in 2008 with a -50.76% loss.
Major Trade Risks: Any intervention from OPEC to support oil prices is a risk to this outlook, as is a swift recovery in risk sentiment and a fall in COVID-19 cases.