The pilot stated he was participating in a balloon competition event. He over flew his second target and climbed to 6,800 feet en-route to the third target. The basket started oscillating from right to left and he became disoriented. The pilot could not focus on the gauges and could not determine if he was climbing or descending. The pilot stated he thought he was descending, but the balloon was climbing. In order to arrest his perceived descent, the pilot continued to operate both burners which further increased his rate of ascent. During the climb he noticed the parachute at the top of the balloon had shifted to the left and was letting out hot air. He tried to re-seal the parachute by adding more heat with the burners, and realized the balloon was in a rapid climb. The air in the balloon was evacuated and the balloon began to streamer resulting in a rapid descent. The basket collided with a tree and the pilot was ejected from the basket. Examination of the envelope/balloon revealed the balloon was intact. All damage to the balloon was related to heat damage from the improper use of the burners or impact damage from the tree. No precrash mechanical anomalies were noted during the inspection.