After a nearly 40% rally in the last month — an unusually outsized move for any commodity — the charts are now flashing warning signs, Miller Tabak’s Matt Maley told CNBC’s “Trading Nation” on Thursday.
Natural gas prices fell by about 3.5% on Thursday after climbing nearly 4% in the previous session.
“Even though I’m bullish longer term, I just think the thing has become overbought,” the firm’s chief market strategist said.
When natural gas prices spiked Wednesday, their relative strength index reached 80, a level that has “signaled near-term tops” throughout much of this year, Maley said.
The commodity found another long-term bull but near-term worrier in Nancy Tengler, the chief investment officer of Laffer Tengler Investments.
Her firm recently launched a green energy-based product for its clients that owns some natural gas stocks but hedges them with oil, she said in the same interview.
“I think we are due for a pullback, but long term, this is a relatively clean solution to energy, and I think we’re going to continue to see strength in natural gas over the coming years from a fundamental standpoint,” she said.
Read More: Why natural gas could extend its pullback, according to charts