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Can Centennial Resource Development Gain Upward Momentum?

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Moving average

Centennial Resource Development (CDEV), a Permian-focused exploration and production company, continues to trade above its short-term (50-day) and long-term (200-day) moving averages despite the recent weakness in the upstream energy sector, which indicates a bullish sentiment in the stock. CDEV was trading 2.9% above its 50-day SMA (simple moving average) and 6.0% above its 200-day SMA as of September 7, 2018.

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Recent positive rating updates, gains in crude oil prices, and the narrowing of the WTI spreads might continue to drive positive momentum in CDEV stock. On the other hand, a steep decline in crude oil prices, which seems less likely, could push CDEV below its 50-day SMA resulting in a bearish sentiment.

Short interest

The short interest in Centennial Resource Development was 18.6 million shares as of September 7. At the same time, the short interest in Centennial Resource Development as a percentage of the float ratio was 9.74%, higher than the 30-day average of 9.03%, which might indicate a bearish sentiment in CDEV’s stock. However, short interest in CDEV is still lower than the one-year average of 10.0%.

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