Here's why the worst isn't over for energy stocks, technician says

, the largest stock within the sector, also suggests more downside ahead for the entire energy trade, Wald says.

"Exxon Mobil [is] turning lower from the bearish slope of its 200-day moving average. We define that as a resumption of the downtrend," said Wald. "When you've got the biggest stock in the sector acting as that headwind in what is a broad list of bearish trends in this sector, we recommend underweight, avoiding, stay away from energy.""The fundamentals look just as bad as the technicals," said Sanchez.

Commodity investors fear that trade-sparked slowdowns in the U.S. and Chinese economies, the two largest in the world, could suppress demand for oil. "The problem with the oil industry is it moves very slowly, so it can't really turn on a dime. It's not going to shut off a whole bunch of oil wells just because of a few demand numbers, so this takes time to play out, and inevitably it just means that you just suffer as the market slowly right sizes," she said.

Sanchez adds that a strengthening U.S. dollar against a weakening foreign-exchange environment could also hit crude oil prices. A strong greenback deters foreign buyers from purchasing costlier U.S.-produced and -priced oil.

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