Everyone is short natural gas. That’s the setup.
The COT fade, an honest 33% win rate, and the trade I’m taking on UNG.
Every week, futures brokers report positioning to the CFTC: speculators in one bucket, commercial hedgers in the other. The hedgers are the shipping and energy companies protecting real cash flows. They’re the ones in the know. And when speculators reach an extreme against them, that extreme tends to get faded. Not immediately, but eventually. Credit to Jason Shapiro, a Market Wizard, for the original framework. I ran it through my own quantitative lens and built an oscillator on the data.
Right now that oscillator says speculators are more short natural gas than they’ve been in three years. Paired with the chart, UNG just undercut a major low around 10 dollars and rallied back through, the second trap at that support.
The plan Pro members got: enter on the open, stop just under support at 9.90, then convert to a trailing stop and let it run. No target, because the whole strategy lives on the rare runner. The honest numbers: the beta system wins about 33% of the time, the drawdown curve touched 33%, and there’s a decade in the backtest where it does nothing. Most trades are small haircuts. One in three pays for everything. That’s what a real edge looks like before the polish, and the losses will get published at the same volume as the wins.
These setups, plus the ten core systems, go to Stats Edge Pro members whenever the scans find one. $149.99 a month, 30-day money-back guarantee.
Michael Nauss, CMT, CAIA, CDMS