Natural Gas COT Index: 10 Years of Extreme Positioning
On October 20, 2026, Commercials in natural gas held a net long position of 222,969 contracts. That is their largest net long in ten years, and their COT Index sits at 100. At the same time, managed money funds are close to their largest net short of the past three years. How often has this market reached an extreme, what happened next, and how does it line up with seasonality? We checked every week since October 2016.
How we read the Commercials COT Index
Commercials in natural gas are producers, utilities, gas merchants and the banks that provide hedges to their clients (swap dealers). The CFTC COT report shows their net position (long minus short contracts) every week. When gas is cheap, consumers lock in low prices by buying, and producers hedge less. When it is expensive, the opposite happens. So the raw number says little on its own, and we put it in context with the COT Index.
COT Index = (current net position − 156 week minimum) / (156 week maximum − 156 week minimum) × 100
A reading above 90 means Commercials are near their largest net long of the past three years. A reading below 10 means the opposite: they are selling aggressively and are close to their largest net short. You can see the index for every market in our free COT demo.
Ten years of natural gas: how often we hit an extreme
From October 25, 2016 to October 20, 2026 there are 522 weekly COT reports for NYMEX natural gas. Of these:
- 56 weeks with the index above 90, spread across 14 separate periods;
- 30 weeks with the index below 10, spread across 8 separate periods.
The two extremes belong to different eras. The zone below 10 appears only from 2016 to 2020: late 2016, spring 2017, November and December 2018, and September to December 2020. There has not been a single week below 10 since December 2020. The zone above 90 shows up from June 2019 to March 2020, briefly in 2023, in October and November 2024, and almost continuously through 2026.
The most telling stretch is 2019 to 2020. Commercials entered the zone above 90 on June 25, 2019, with the front month around $2.30. They stayed there, on and off, until March 2020, while price kept falling to $1.482 on June 25, 2020, the lowest of the entire decade. The hedgers were right, but a year early. From that low, gas climbed to $9.68 in August 2022.
The opposite extreme came on October 20, 2020: the largest Commercial net short of the period, −97,039 contracts, shortly before gas began a two-year advance.
What follows the first week in the zone
To test this in numbers we ran a backtest. We take the first week the index enters a zone, with at least 26 weeks between two signals of the same type. Entry is the close on the Friday after the report date (when the CFTC releases it). We measure the price change after 4, 8, 13 and 26 weeks and compare it with the average change for all weeks in the period. Natural gas rolls to a new front month every month, so prices are back-adjusted on the day after each expiration.
| Report date | Index | 4 wks | 8 wks | 13 wks | 26 wks |
|---|---|---|---|---|---|
| Above 90 | |||||
| 06/25/2019 | 96.8 | −6.0% | −6.6% | +3.3% | −1.8% |
| 01/07/2020 | 90.5 | −13.4% | −17.3% | −18.8% | −33.1% |
| 03/07/2023 | 90.6 | −21.7% | −25.2% | −26.0% | −28.9% |
| 10/22/2024 | 100.0 | +0.8% | +15.0% | +10.3% | −9.9% |
| 10/21/2025 | 91.4 | +18.3% | −3.3% | +51.1% | +54.9% |
| 05/19/2026 | 93.3 | +2.9% | −5.9% | −11.4% | n/a |
| Below 10 | |||||
| 04/11/2017 | 5.6 | +1.5% | −6.3% | −7.7% | −6.5% |
| 11/20/2018 | 8.9 | −10.1% | −9.6% | −27.1% | −29.6% |
| 09/01/2020 | 4.2 | −22.7% | −3.5% | −24.5% | −14.1% |
The result is clear and points one way:
- Below 10 has been a strong warning. All three signals ended lower after 8, 13 and 26 weeks. On average price was 10.4% lower after 4 weeks and 19.8% lower after 13 weeks. Only one signal was positive after 4 weeks (+1.5% in 2017).
- Above 90 is not a buy signal. On average price was 3.2% lower after 4 weeks and 7.2% lower after 8 weeks, with only 1 of 6 signals positive after 8 weeks. Commercials in gas buy early and often stay in the zone for months while price keeps falling.
- The signals above 90 that worked came in autumn. The two signals with gains above 10% (October 2024 and October 2025) came in late October, right before the heating season. The spring and summer signals (June 2019, March 2023, May 2026) all ended lower after 8 weeks.
For comparison, the average change across all weeks is +0.9% over 4 weeks, +1.4% over 8, +2.1% over 13 and +6.8% over 26 weeks, with fewer than half of all weeks ending higher. The sample is small: 6 and 3 signals in ten years. This is context for a decision, not a statistically proven system.
Seasonality during these periods
The average seasonal curve for the last ten years (2016 to 2025) is steeper than in the grain markets:
- January: a swing, with a peak around January 12 (about +8%) and a dip to about −3% around January 22;
- February to the end of April: sideways around zero;
- May and early June: a rise to about +17% around June 7, then a drop to about +5% by the end of June;
- July and August: a strong climb to about +21% by late August, with the high of the year around September 14 (about +26%);
- mid September to around October 21: a decline to about +9%;
- November: a new peak around November 29 (about +22%);
- December: the sharpest drop of the year, to about +2% by the end of December.
The 15 year curve has the same shape but sits lower and ends the year at about −4.5%. Gas is a market where a few strong years pull the average around, so also look at how many years moved in that direction.
Extreme Commercial positioning has its own calendar too. Weeks above 90 are most common in October (9 of 56), August (8) and January (7). Weeks below 10 are concentrated from September to December (20 of 30 weeks) and in May, with none at all in February, March, or June through August.
For where we are right now, the curve is misleading. Comparing the October 27 close with the end of December for each of the last ten years, price finished lower in 7 of 10 years. The median change is −5.1% and the mean is −7.5%.
Where we are now
According to CFTC data as of October 20, 2026:
- Commercials net position: +222,969 contracts (COT Index 100), the largest in ten years;
- managed money net position: −157,409 contracts (index 1.2 on 156 weeks);
- open interest: 1,710,685 contracts, after a record 1,837,146 on September 22, 2026;
- natural gas has been in the zone above 90 since July 28, 2026, now 13 weeks in a row.
Under our 26 week rule between signals, this is not a new signal but a continuation of the zone that began in May 2026. Over these 13 weeks, Commercials have added 43,305 contracts to their net long, while price is slightly lower than at the end of July ($2.747 on July 31).
The daily chart shows the sharp drop of the last few days. On October 15 the front month closed at $3.236, and on October 26 at $2.602, 19.6% lower in 7 sessions. Since October 16 price has closed below the 18 day moving average, now at $3.035. Price is close to its 12 month low ($2.523 on April 24, 2026), far below the winter peak of $7.460 on January 28, 2026.
Here the frameworks contradict each other:
- COT: Commercials hold their largest net long in ten years, and funds are close to their largest net short in three years. That is pressure built up to the upside.
- Backtest: signals above 90 have on average brought further declines over 8 weeks. The exceptions are the two autumn signals of 2024 and 2025.
- Seasonality: from late October to the end of December price finished lower in 7 of 10 years.
- Price: a strong short term decline, below the 18 SMA, with no sign of a reversal.
When COT positioning is at an extreme but price is still falling, the entry has to come from price, not from the index. The scenario we are watching: a reversal and a close above the 18 day average while funds are still short. Then the built-up pressure can be released quickly, as in November 2024 and December 2025.
5 mistakes when trading COT extremes in natural gas
- Buying the first week above 90. On average price was 7.2% lower after 8 weeks. In 2019 Commercials were in the zone a year before the low.
- Ignoring the calendar. Autumn signals above 90 worked, spring and summer ones did not. Gas is a market driven by weather and the heating season.
- Seasonality without context. The average curve shows an autumn peak, yet in 7 of 10 years price was lower at the end of December than on October 27.
- Large size in a highly volatile market. Gas can move 20% in a week in either direction. Use the risk calculator and a fixed percentage risk.
- Watching Commercials only. Check open interest too, and what the funds on the other side are doing.
How we use this in practice
In our strategy Commercial COT positioning is a mandatory filter: we do not look for shorts when Commercials are in an extreme long zone, and vice versa. In natural gas the filter currently says "careful with shorts", seasonality says "weak period", and price is still falling. We are waiting for price to show which signal wins.
Frequently asked questions
How many times has the natural gas COT Index been above 90 in ten years?
56 weeks out of 522, spread across 14 separate periods. The longest is the current one, since July 28, 2026 (13 weeks as of October 20), followed by June 25 to August 27, 2019 (10 weeks).
How many times has it been below 10?
30 weeks across 8 periods. The longest ran from September 1 to November 17, 2020 (12 weeks). The index has not fallen below 10 since December 2020.
Why do you use 156 weeks for the COT Index?
Three years cover three heating seasons and several production cycles. A shorter window gives more signals, but also more noise.
How did you calculate prices and seasonality?
We use the continuous front month NG=F, back-adjusted on the day after each monthly expiration so that the gaps between contracts are not counted as price movement. The charts show the actual front month price in dollars per MMBtu.
Is this a signal to buy natural gas now?
No. This is an analysis of historical data. COT positioning shows pressure built up to the upside, but the backtest and seasonality point the other way, and price is still falling. The entry should always come from price and from your own risk management.
Conclusion
Over ten years, Commercials in natural gas were at an extreme in roughly one week out of six. The zone below 10 was a reliable warning of declines in all three signals. The zone above 90 has tended to be early: on average price kept falling for another 8 weeks, except for the autumn signals. Today Commercials hold a record net long, funds are deep in a short, and price is falling sharply right before a seasonally weak December. This is a situation worth tracking every week.
You can follow the current COT Index for natural gas and dozens of other markets in the free demo, while the weekly analyses and the full toolset are available in our membership plans.
Sources: CFTC Commitments of Traders (Legacy and Disaggregated, Futures Only), data as of 10/20/2026; Yahoo Finance (NG=F), prices as of 10/26/2026. Calculations: fmoney.eu. Futures trading carries a high risk of loss. This content is for educational purposes only and is not investment advice. Past performance does not guarantee future results.