Why natural gas can prolong its decline according to the graph

Why natural gas can prolong its decline according to the graph

The prices of natural gas are taking unnatural movements.

Miller Tabak’s Matt Maley told CNBC’s “Trading Nation” on Thursday that after a rally of nearly 40% over the past month – an outward movement unusual for any commodity – the charts are now showing warning signs.

Natural gas prices fell about 3.5% on Thursday after climbing nearly 4% in the previous session.

“While I’m optimistic about the long term, I think the thing has gotten overbought,” said the company’s chief market strategist.

Male said when natural gas prices rose on Wednesday, their relative strength index jumped to 80, indicating a “near-term high” for most of this year.

“On its weekly charts, it is also above 80, and it’s the second highest buy in a decade,” Maley said.

“It doesn’t mean that the bull market is over for this product. I think when you get an overbought weekly chart the pullback is going to be more than a few days, and [Thursday’s] I think the withdrawal will not be the end, ”he said. “We will have to see a setback that will last more than a few days. “

The commodity found another long-term bullish but short-term concern at Nancy Tengler, chief investment officer at Laffer Tangler Investments.

In the same interview, he said his company recently launched a green energy product for its customers, who own natural gas stocks but cover them with oil.

“I think we’re on the verge of a setback, but in the long run it’s a relatively clean solution for energy, and I think we’ll continue to see the strength of natural gas from a perspective. fundamental in the years to come, ”she said. . . .

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