NAT GAS SPECIALIST · Energy / Demand
Z102178 – [NG] US48 Power Burn Z
Power-sector gas burn is the biggest US industrial demand driver. The signal reads burn extremes as a mean-reversion gauge rather than a trend.
At a glance
IN-SEASON · ACTIVE
Current composite
-0.372
On the plus-or-minus one tanh scale
SEASONAL STATE
IN-SEASON · ACTIVE
Live year-round on daily cadence.
Signal state
NG Bear Burn Cool
Current state across the three-state regime machine.
Phase duration
6 sessions
Current Moderate NEG run.
As of Nov 02, 2026. Updated nightly.
SIGNAL OVERVIEW
US electric-power-sector nat gas consumption is the single largest industrial demand pillar for the fuel. Weekly burn cycles with summer cooling load, coal-switching economics, and renewable output gaps. The signal reads burn against its 52-week rolling average.
The effect is mean-reversion, not trend. State plus one (burn high) delivers minus 5.28 percent forward 60-day, a minus 4.22 percentage point edge BELOW the minus 1.06 percent baseline. State minus one (burn low) delivers plus 2.29 percent forward 60-day, a plus 3.35pp edge ABOVE baseline. Interpretation: when burn is running HIGH, that bullish demand is already in the spot price and the forward outcome tilts bearish. When burn is running LOW, the low demand is priced and the forward tilts bullish (mean reversion toward trend).
LIVE CHART
Weekly US48 power-sector natural gas burn against NYMEX natural gas forward returns.
What the chart is showing. The dark line in the top panel is the US48 power-burn composite on a tanh-bounded plus-or-minus one scale. Positive means burn running hot (bearish-forward via mean reversion). Negative means burn running cool (bullish-forward via mean reversion). The bronze line in the middle panel is NYMEX natural gas.
COMPOSITE
-0.372 / tanh
STATE
NG Bear Burn Cool
PHASE
-1
FWD 60d
+2.29% (edge +3.35pp)
SAMPLE N
8,926 days
TODAY’S PLAYBOOK READING
STATE
NG Bear Burn Cool
STATE AND HISTORY
Composite -0.372 (NG Bear Burn Cool, 6 sessions). US power-burn is running mildly below the 52-week rolling average. State Moderate NEG has historically delivered plus 2.29 percent forward 60-day, a plus 3.35pp edge above the baseline.
THE MEAN-REVERSION MECHANIC
Power-burn extremes work as a MEAN-REVERSION signal, not a momentum signal. High burn means the bullish demand is already reflected in spot prices and the forward tilts bearish. Low burn means the weakness is priced and forward tilts bullish.
HOW TO POSITION
Read alongside the HDD anomaly weather-demand read and the ERCOT regional demand read for a multi-channel demand view. Watch the Thursday EIA weekly release for updated burn figures.
WHAT THE CHART SHOWS
The composite tag at the right edge of the top panel is sitting at -0.372, firmly in the NG Bear Burn Cool band. The bronze NG line is trading near 2.86.
TOP INPUTS FIRING
- Primary composite -0.372 Tanh-bounded 52-week z-score of EIA weekly US48 electric-power-sector nat gas consumption. In the NG Bear Burn Cool band.
- Raw rolling z-score -0.38 Power-burn sits about four-tenths of a standard deviation below its 52-week trailing average.
- Phase run 6 sessions Current Moderate NEG regime, early in the run.
THE TAKEAWAY
What this means for you today
WHAT THE POWER-BURN SIGNAL IS TELLING YOU
The composite reading of -0.372 sits in the NG Bear Burn Cool band, 6 sessions into the current regime. Raw z is -0.38, meaning US power-burn is running about four-tenths of a standard deviation below its 52-week rolling average. By the mean-reversion pattern, the state-conditional forward sixty-day edge is plus 3.35pp above the baseline.
THE NG DEMAND STACK
This signal is the POWER-BURN leg of the NG demand stack. The HDD anomaly reads residential heating demand. The ERCOT demand YoY composite reads Texas regional load. Together they cover the three pillars of US gas consumption.
WHAT WOULD CHANGE THIS READING
Two triggers. First, the composite crosses above plus 0.5 (Extreme POS, high burn). Mean-reversion inference goes bearish. Second, the composite drops below minus 0.5 (Extreme NEG, low burn). Mean-reversion inference goes strongly bullish.
THE REGIME MAP
The three regime states, forward returns and sample share
Behavior across the US48 power-burn composite (NYMEX NG benchmark, 1991 through present, 8,926 live-signal days). CLEAN MEAN-REVERSION monotonic edge pattern.
| State | Phase | Share | Fwd 60d | HAC t | Edge vs baseline | Last firings |
|---|---|---|---|---|---|---|
| Low power burn (forward BULLISH via mean reversion) TODAY | -1 | 9.6% (853 d) | +1.68% | +2.74pp | Oct 2026, Oct 2025, Feb 2025 | |
| Normal burn | 0 | 83.1% (7419 d) | -1.31% | -0.24pp | Oct 2026, Feb 2026, Jan 2026 | |
| High power burn (forward BEARISH via mean reversion) | +1 | 1.8% (163 d) | -5.28% | -4.22pp | Jun 2026, Feb 2026, Jun 2025 |
The historical pattern of US48 power-burn mean-reversion events
The signal across US power-burn mean-reversion history
What this measures
Weekly US electric-power-sector nat gas consumption cycles with summer cooling load, coal-switching economics, and gaps in renewable output. The signal reads burn against its 52-week rolling average. The historical pattern shows MEAN REVERSION rather than momentum. Extreme high burn is already in the spot price and tends to predict forward weakness. Extreme low burn predicts forward strength.
Why it matters
Why power burn mean-reverts rather than trends
Three structural reasons. Coal-switching economics cap the upside in burn: when gas is cheap it displaces coal, when gas is expensive coal displaces gas back. Renewable output gaps are mean-reverting over 1-2 month horizons. Weather-driven cooling demand is itself mean-reverting against seasonal norm. The combined effect makes power-burn extremes predict forward price reversion.
Why this is the physical-demand complement to HDD and ERCOT
The NG demand stack reads three structurally-distinct channels. HDD anomaly reads residential heating. ERCOT demand YoY reads Texas regional load. This signal reads POWER-SECTOR BURN, the single largest industrial nat gas demand pillar.
How to use this signal today
The composite -0.372 reading is in the NG Bear Burn Cool band and the phase has been running 6 sessions. Mean-reversion inference favors forward bullish.
Signal consumers and siblings
Not investment advice · The analysis on this page is informational and educational. Signal readings, historical case figures, and empirical statistics are derived from publicly available data and are provided without warranty. Hypothetical performance results have inherent limitations, including the benefit of hindsight. Readers who intend to trade should consult a licensed investment professional and see the research brief for the full disclaimer.
Last refreshed Nov 04, 2026 09:19 PM ET