Natural gas futures, which jumped 28 percent last week, may revisit seven-year lows after surging into an “overbought” area of resistance between $3.58 and $3.87 per million British thermal units, according to a technical analysis by Barclays Capital.
Gas tumbled 82 percent from a high of $13.694 per million Btu in July 2008 to touch $2.409 on Sept. 4. Gas then surged 57 percent through Sept. 18. The futures have entered a resistance zone and the downtrend is likely to resume, MacNeil Curry, a New York-based analyst at Barclays, said in an interview.
“We’re around the high end of this resistance zone and things are overbought,” Curry said. “This is still an environment where bounces should be sold. I would look for it to” test $2.409 again....MORE