In trading on Friday, shares of Kinder Morgan Inc. (NYSE:KMI) entered into overbought territory, changing hands as high as $31.70 per share. We define overbought territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be overbought if the RSI reading rises above 70.
In the case of Kinder Morgan Inc., the RSI reading has hit 71.9 — by comparison, the universe of energy stocks covered by Energy Stock Channel currently has an average RSI of 54.6, the RSI of WTI Crude Oil is at 65.4, and the RSI of Henry Hub Natural Gas is presently 53.6.
Investors could look at KMI's 71.9 reading as a sign that the recent heavy buying is peaking which could mean shares are due for a pullback.
Looking at a chart of one year performance (below), KMI's low point in its 52 week range is $23.51 per share, with $32.14 as the 52 week high point — that compares with a last trade of $31.20. Kinder Morgan Inc. shares are currently trading up about 3.1% on the day.
KMI operates in the Gas Utilities sector, among companies like AmeriGas Partners, L.P. (NYSE:APU) which is up about 0.1% today, and NICOR Inc. (NYSE:GAS) trading lower by about 0.3%. Below is a three month price history chart comparing the stock performance of KMI, versus APU and GAS.
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