Power Emini Commentary – Notes – Education – Examples
This is the Power Emini “Notes” section. Below you’ll find ongoing commentary, trade examples, charts and general short-form random posts. This page gets updated every few days, so check back soon.
A Boring End To The Month
8/31/2026
I started having email problems this morning and as of right now (an hour after the market close) I’m still not able to get into my email. That’s because Microsoft has been having issues all day with most of their services. I always check https://downdetector.com/ to see if the problem is on my end or with some provider. If you sent me an email today and didn’t get a reply this is why.
Just figured I’d mention that and Outlook wasn’t the only provider with issues today, there were lots of them.
The price action was about as dull as it gets for most of the day. The ES / MES Momentum System gave a Short Alert about 40-minutes after the cash open and it managed to hit Target 1 for +7.75 points and then the market went into “sideways chop mode” until late in the afternoon. Almost all the price action after the first hour of trading was between 7680 and 7690 with a few pokes above and below that zone until 2:00 eastern when the (tightened) Trailing Stop finally got hit. It was basically a breakeven on a 2 Contract trade and in hindsight just taking T1 and calling it a day would have been the best play.
Sideways markets are the worst and it felt like watching the grass grow this morning.
But this was kind of expected because as I’ve been saying, the couple weeks right before Labor Day are seasonally not ideal trading conditions. Over the years we’ve just learned to accept that there are certain periods where the market is just dull and choppy. The last couple weeks of the year are similar with everyone focused on the Holidays.
One of the best ways to deal with a day like today is probably just to close up shop early and do something else instead of staring at the screens all day while the market does nothing.
It’s hard to know if the rest of this week will be similar or if we’ll see some decent action since we’re headed into a new month. But a week from today is Labor Day and after that things should start to heat back up.
August actually started off great for the system the first couple weeks and then things tapered off and the market went into the typical Summer Doldrums mode. The good news is that the standard 2 Contract strategy ended the month with a gain and that’s something considering the overall market has been trapped in a sideways range itself.
A daily SPY chart provides the best look at the ES cash session. SPX doesn’t reflect the open price properly and the ES daily chart includes the Globex session.
So we can pretty much ascertain from that daily SPY chart why the first half of the month made for good trading conditions and the last half wasn’t optimal. The more directional price movement the better. It’s hard to surf if there are no waves. Small range doji days just aren’t great trading conditions no matter what strategy we use and I think by now we are all aware of that. The more experience and the longer one has been trading the more they appreciate the effect market conditions have on everything.
The only way to make money trading is with “directional price movement”. In other words we want to get into a trade and have the market move – or continue to move – in the direction of our trade. Sideways directionless markets don’t offer much to work with and we see quite a few sessions like that on the chart. Honestly when the overall market is making a “trend move” it makes for ideal trading conditions. When the daily chart is trending the market tends to offer more intraday trend sessions – like the first few days this month.
Generally speaking when the market trades sideways for a period of time it “coils up” and eventually when it breaks out of the range the move is significant. And I’m talking about the daily timeframe.
So the main question is whether the rest of this week is dull and it coils up even more, or whether the “new month” effect causes the action to pick up. I’m old enough to remember when school didn’t start back up until after Labor Day.
September starts tomorrow so we shall see.
August Is Almost Over
8/28/2026
It’s the last Friday in August and this week has been about what I expected. It’s been a little over 10-years since we created the first version of the Alert Software and over that time I’ve come to realize and accept that the last couple weeks of August typically don’t make for ideal trading conditions. I’ve been talking about that all month so it shouldn’t be a surprise that this week was best described as “meh”.
Monday is supposed to be Labor Day but the calendar is weird this year so it’s the last trading day in August.
Today was certain to be an odd day with the new Fed Chair speaking at Jackson Hole. The best thing was that the system was done early because there was a lot of craziness that happened after it was finished for the session.
This is the most zoomed-in chart I’ve posted in a while, but it’s interesting how things played out this morning.
The tolerances were pretty tight and everything happened really fast. The Long Entry looked perfectly valid from a technical standpoint and the Trailing Stop tightened when price got close to Target 1. But it didn’t quite make it and hit the Stop shortly before that “crazy candle”. That candle actually encompassed that entire range in 1-minute at exactly 10:01 eastern. Strange indeed.
Then we see the Short Alert that filled and hit Target 1 exactly 31-seconds later. The following candle hit Target 2 and the following candle hit the Trailing Stop that was “protecting Target 1” and that was it for the session. Then system goes offline for the day when an Alert hits both Targets and then (eventually) the Trailing Stop.
It’s probably a good thing because price rallied over 50 points and then dropped over 50 points and the session was just plain old “hectic” due to “Fed speak” and the interpretation of what was said. Today was basically a wash or should I say a “warsh” for a 2 Contract trader and I’m glad the week is over.
The past couple days were mixed and I was tied up with some things and decided to wait until the week was over to post. Yesterday was actually a good day for the system with only one Alert that hit T1, which was “protected”. Wednesday was a bust with 2 full stops hit and the final Alert only hitting Target 1 for a breakeven.
I wouldn’t read much into this week because we expected it to be weird seasonally speaking and I had low expectations to begin with. It’s like this every year and quite frankly I’m surprised at how well things went the first couple weeks of August. A lot of what we’ve seen lately isn’t what I’d consider normal price behavior and as I’ve been saying, things tend to normalize after Labor Day.
And that still leaves next week.
We’ll see how it goes.
A Fairly Normal Morning Session
8/25/2026
The reason I say “fairly normal” is because the distance to the Targets was a little less than normal, but that’s to be expected this time of year. Overnight the ES Futures rallied and then a few hours before the cash open it peaked out and began to trend down. Lower highs and lower-lows. The first 20-minutes of trading saw a lot of congestion and then price finally broke down through the bottom of the range.
The system issued a Short Alert that filled and hit both Targets in the first hour of trading. Notice Target 1 was only 4.00 points which is about as small as it gets. And Target 2 was only 12.25 points and for comparison sake the first trading day of August Target 1 was 11.50 points.
I took this screenshot when T2 got hit.
Notice that the system fired off a “potential” Short Alert at 9:45 that didn’t trigger-in. Ten minutes later it gave another Short that did fill just 1-tick below the Alert price.
Keep in mind that the fill (Entry Confirmation) can be a couple / few ticks “past the Barrier / Alert price” or it can be a couple / few points past it. It doesn’t really matter where the fill occurs because the Stop and Targets are calculated from where the system took the Entry. And you want to ignore any slippage because it will all even out over a large number of trades.
We have some new users so I figured I’d mention that.
There was one unusual thing today. The candle that hit T2 saw a quick spike down WAY past Target 2. I believe that was due to a Trump comment but as we see on the chart, price was very likely to hit it anyway.
In case you were wondering about the 28.00 points of “Traction” in the Alert Software screenshot I marked it on the chart. The Traction indicator displays the maximum negative and positive price excursion from the Entry Confirmation level.
Speaking of slippage, this is one of those cases where there was potentially a lot of slippage in our favor past T2. In other words, say you were sitting there watching price approach Target 2 intending to sell manually and close the trade. The 1-minute candle that hit T2 also encompassed all that extra Traction so in the time between where you realized T2 was getting hit and the time you clicked to sell, you might have grabbed extra points.
I’m just putting that out there because it’s also perfectly reasonable to set limit orders at the Targets and go about your business. Both methods have pros and cons which I’ll eventually discuss in another post here.
Notice how the Trailing Stop tightened to “protect Target 1” as price got close to T2. The numbers were small today but that can make a big difference in more volatile conditions and it’s one of the newest features we introduced in the system back in June. I staggered the lines on the chart slightly so we could see both Target 1 and the yellow Trailing Stop line.
And that was basically it for the day. It took about an hour between T2 getting hit and price rebounding to the tightened Trailing Stop but it’s interesting to see how the bottom of the Range and the Short level acted as a major resistance level the rest of the session. And the price action slowed down and really got dull after what you see on that chart.
Maybe just trading the morning session is the way to go until things pick back up. (Unless of course there’s still an open trade going into the afternoon).
Why Target 1 Is So Important
8/24/2026
If you’ve been trading a while it was fairly obvious that this mornings price action was what I’d characterize as sketchy. Overnight and pre-market also saw price flailing around erratically. No big surprise because as I’ve been saying here, this time of year we have to expect that. This whole week is likely to be “sketchy”.
So right out of the gate today price made an “impulse move” down and broke below the overnight lows and opening range. The MES Momentum System fired off a Short that hit Target 1 for +7.00 points. It wouldn’t have been unreasonable to go ahead and just close out there. It won’t surprise me to see more erratic “impulse moves” this week than smooth trend moves and it typically takes a significant trend move for price to reach Target 2.
“Hitting Target 1 is like shooting fish in a barrel”. (occasionally you’re gonna miss). But the beauty of it is that once T1 is hit the Trailing Stop has the entire position around “breakeven” on a “2 Contract trade shooting for both Targets”. Just shooting for Target 1 could be considered more like “scalping” with the Momentum System, but it’s perfectly viable in certain market conditions.
Then there’s the strategy I should mention more often. Trading 3 MES Contracts and looking to sell two at T1 and one at T2. This strategy insures that every single Alert that hits T1 will be profitable.
It’s ok and probably advisable to vary the “scaling strategy” based on market conditions in my opinion. When the market is obviously exhibiting choppy and erratic price action it makes sense that it’s more likely to just flail around randomly than make a big directional trend move.
The impulse moves typically result in T1 getting hit but the price action isn’t always conducive for a large trend move to T2. I’ve talked about the difference between impulse moves and trend moves before.
Using this morning’s Short Alert as an example, here’s how the 3 different scaling strategies I mentioned turned out.
2 Contracts “just shooting for T1” +14.00 points
2 Contracts “shooting for both Targets” +1.75 points (breakeven)
3 Contracts “sell 2 at T1 and shoot for T2” +15.75
When I talk about varying scaling based on market conditions it’s important to take the distance to the Targets into consideration. In other words if T1 is say 3-4 points that means the ATR’s are small that day and we might as well shoot for Target 2. Last month there sessions where T1 was 14.00-15.00 points. Those are totally different types of “market conditions”.
It might make sense to take that into consideration, or maybe it’s just me. I don’t want to get into a lengthy discussion about position size but it’s worth thinking about how market conditions can vary drastically and think about how we handle that. I bring this up again because I expect market conditions to be “weird” between now and Labor Day. I wouldn’t read too much into things until we get through this period and the markets normalize next month, which they typically do in September.
You might consider trading smaller size this week and consider just shooting for T1 with the understanding that’s we’re in a seasonally weird period. I used to say the market was “dull” around this time but I’m realizing that low-participation environments can also make for exaggerated price moves. That’s why I’ve been using the term “erratic” more than usual.
I’m off to lunch and I might follow-up later after the session is over. Sometimes it’s not unreasonable to just call it a day early. The last thing I want to do is stare at the screens only to watch price grind around erratically the rest of the day with little to no “momentum”.
OPEX Friday Random Thoughts
8/21/2026
It’s been an odd week which I sort of expected given end of August “seasonality” and I’ve been talking about that all month. You’ve probably noticed periods too where price just seems to be “moving in slow motion”. It just feels like there’s low-participation and the market goes from chopping around in dull ranges to exaggerated moves out of the blue. The price action has been more erratic than usual.
Chalk it up to the Summer Doldrums.
“The summer doldrums refer to an old maritime term from the 18th century used to refer to long periods of calm, windless seas. These were periods where the typical ocean winds completely disappeared due to low-pressure zones around the equator. These stagnant conditions trapped sailboats and sailors out in the middle of the ocean for days and weeks on end… floating adrift. The only thing sailors could do was be patient and wait for the normal winds to pick up again.”
That’s a pretty good analogy for recent market conditions.
But all in all the Momentum System has handled August pretty well so far. Actually the first couple weeks turned out way better than usual and this week is best described as “meh”. And there’s still one more trading week in the month so I’m thinking about what to expect. There’s actually some market-moving events next week so maybe the action will pick up a bit.
Today started off with more of that “morning chop” we’ve seen a lot of lately and the first Alert only made it about half-way to Target 1. The second Alert hit Target 1 and got really close to Target 2 so the Trailing Stop moved to “protect Target 1”. Other than the “impulse move” that triggered the Long Alert the rest of the session was a fairly boring drift “all over the map”. OPEX days can be weird and price ended the day about the same level as it started.
It seems like the further we get into August the “flakier” the price action has become.
I was reviewing the posts on this page and almost forgot the first session this month Target 1 was 11.50 points and Target 2 was 36.00 points (scroll down and check it out). And then the next day was that day where price got over 100 points of “traction”. The month started off gangbusters and then kind of fizzled out a bit and I’m just chalking it up to the fact we’ve experienced these weird market conditions around this same time every year.
Things usually get back to normal after Labor Day but that still leaves the next two weeks. I’m convinced there’s something to seasonality and the Fall is traditionally a great time of year for trading and for the system. Quite frankly I’m surprised at how well this summer has turned out so far but we know the market can vary drastically from session to session so we’ll just take it day by day the next couple weeks.
“In trading, everything works sometimes and nothing works always” ~ Ed Seykota
What A Mess
8/20/2026
Every now and then the market serves up a rotten session for the system where the price action just basically “thwarts” the Alerts. We expect there will be stop-outs here and there and not every day can be great, but I was just saying that 3 Alert days are fairly rare and we get two of them back-to-back.
3-Alert sessions typically indicate the market is choppy and non-directional early on and the first two Alerts either hit the initial stop, trailing stop or Target 1. It’s not hard to understand that sessions when price just kind of zig-zags all over the place it makes for difficult trading conditions.
It’s actually good to experience “rotten days” on occasion but it’s not much fun. It helps keep us from getting overconfident and get a better understanding of what type of price action isn’t conducive to the Momentum System. Today price began a directional move down and triggered the first Short which got enough traction for the Trailing stop to tighten once. But it didn’t quite make it to T1 and price reversed significantly, hitting the stop along the way and then taking out the early highs. That triggered-in a Long right before price reversed again.
I consider the Long a fake-out move while the first one was just a case where the directional move didn’t quite get enough follow-through to make it to T1. There’s a difference.
By now you understand that the system sets a “structure” around the early price action and looks to trade directional moves on breakouts above or below the structure. There are a number of ways an Alert can get “thwarted” as I like to say but every now and then we get these sessions where price basically chops up and down erratically and breaks out and then reverses.
Even trying to trade reversals on a day like today would be difficult. I like to use the term “erratic” to describe when price just flails around with no rhyme or reason. Technical analysis and candlestick patterns and most indicators don’t even offer much help in certain conditions because price moves more randomly than usual.
The third and final Alert ended up hitting the stop. Actually MES hit Target 1 to the tick but ES missed by 1-tick. This happened one other time recently and I talked about it in a post below. Missing a Target by 1-tick or not getting a fill at the Target is another situation where I could use the word “thwarted”.
The Long Alert was just a plain old false move stop-out but on both the Shorts the Trailing Stop did tighten a little so they weren’t considered full stop outs. Sometimes I get the feeling the market likes to humble me when I talk about how well things are going. It wasn’t long ago I had the nerve to write about a streak where over a dozen in a row hit T1 and then the very next day the streak ended.
Speaking of thwarted, the third and final Short Alert hit the “tightened trailing stop” and poked exactly 1-point above it and then the market reversed again and proceeded to sell-off the rest of the session. We got “nicked out” of the trade because the initial stop tightened and then price eventually blew through both Targets. It happens.
Three strikes and you’re out. These choppy sessions do come along every now and then and I think you understand why the system will only take a maximum of 3 Alerts on any given day. Sometimes the price action just isn’t cooperative and there’s no reason to stick around and get chopped-up more.
A while back I mentioned that I’ve considered limiting it to just 2 but there are certain cases where that wouldn’t be optimal. There have been lots of sessions over the years where price is flaky shortly after the open and then a big trend develops and the third one is the big winner. There are plenty of times where maybe one of the first two alerts hits T1 and or the stop and then the market picks a direction and it’s smooth sailing.
That’s basically what happened today but that last Alert got thwarted by a point.
I don’t want to make a big deal about a bad session like today because they just come with the territory and I always say that the system and we as traders are beholden to market conditions and we have no control over that. Drawdown days go with the territory and the less it bothers you the better. Each Alert and each session are just small data points in the overall scheme of things and the longer you’ve been trading the system the less a few stop-outs matter.
Basically today just drew-down some of the gains the system had already racked up this month. Have I mentioned August is my least favorite month of the year?
On a positive note, the system was “done for the day” fairly early again. That usually happens on much better days.
There’s A Lot To Unpack Here Regarding Today’s Session
8/19/2026
Today was a good day for the ES / MES Momentum System considering how erratic the price action was early-on. The system was “done for the day” before lunch.
We have some new users and for their benefit I’ll explain a few things that might seem redundant to you long-time users, but today’s session provided a few examples of some of the “nuances” of the system.
The Momentum System will issue a maximum of 3 “filled” Alerts per session.
All 3 Alerts hit Target 1 today and that’s considered a good day even though none of them hit Target 2. So when the third and final Alert hit the tightened Trailing Stop the system went offline for the day. This helps prevent overtrading on days where the market is extremely choppy and no good directional trends develop. Trading 2 Contracts today shooting for both Targets on all three Alerts, the net result was +16.50 points.
Also, when any Alert hits both Targets and then eventually converges with the Trailing Stop, the system goes offline for the rest of the session too. That’s considered a big win and there’s no reason to stick around and risk giving anything back.
When price gets close to Target 2 the Trailing Stop will tighten to protect the gains at Target 1.
This happened today on two of the three Alerts so those scored 2x Target 1. It really wasn’t the best example of why this is such a great (new) enhancement because the numbers (distances to the Targets) were small. In volatile market conditions you might see T1 at say 12 points and T2 at 32 points. If price only makes it 30 points in the direction of the trade and doesn’t quite hit T2 the system is “at least” protecting the Target 1 level. In cases like that you are always free to protect more of the gains than T1 by using a tighter stop than the system.
Just shooting for Target 1 is a completely viable strategy.
And it’s a perfect strategy for new users to trade the system in the first month or so. While the risk/reward isn’t optimal, the hit rate on Target 1 makes it work and it goes a long way to helping approach the system from the right frame of mind. In other words it’s easy on the nerves because Target 1 getting hit is like shooting fish in a barrel so to speak. It provides an extremely “high win rate” and eases you into the idea that the initial stops may appear wider than you’re used to. Trading 2 Contracts today “just shooting for Target 1” on all three Alerts, the net result was +13.75 points.
Here’s a list of important things I created to help new users get started with the system.
Concepts:
The system has a built-in statistical edge similar to the house odds in Vegas. The “edge” is revealed over a long series of Alerts.
The outcome of any one individual Alert or market session is purely random.
The final result of any given Alert is a function of the price action that manifests after we take the Entry.
The system doesn’t try to predict anything, it “reacts” to the price action as it unfolds and gives alerts in the direction of the current price movement.
New users should start out trading the Momentum System with MES – the system was originally designed for ES and that’s the best overall symbol.
The distance to the Stop and Targets are based on the current ATR’s in today’s session.
Targets and Stops are calculated based off the Entry price – not the Alert price.
The Initial Stop always starts off 1-tick past the opposite side of the Trigger Range – with the exception of the 18 point “maximum stop”.
The ES / MES Momentum System has a max stop of 18.00 points. There is no limit to the upside potential.
The Entry Trigger on an Alert is a 1-minute price bar or candle that CLOSES at least 1-tick or more PAST the Alert Price / Trade Price Barrier.
Not all Alerts will trigger-in or “fill”. It’s possible to see a series of Alerts that never get filled based on the above Entry Trigger rule.
As soon as an Alert “triggers-in” the system calculates and displays the Initial Stop and the 2 Targets.
When Target 1 gets hit, the Initial Stop tightens to get the trade to “breakeven” (a couple points either way is considered breakeven).
Target 1 has a “hit rate” of roughly 75% (over the last several years).
An Alert that hits both Targets will make up for an Alert that hits the full stop.
Results vary considerably based on the number of Contracts traded and the scaling strategy.
Trading 3 Contracts and selling 2 at Target 1 guarantees any Alert that hits T1 will be profitable.
Sometimes price just “blows through” the Targets and it’s possible to capture more points if you’re trading manually.
It’s perfectly acceptable to use a bit of discretion here and there based on the price action and the charts (and your schedule).
You can always use a tighter stop than the system – based on what you see on the charts.
Every market session is different and the system reacts to how the price action unfolds differently.
Results of rules-based trades are all part of the system. All wins, losses, streaks of either kind are necessary to form the edge. When you accumulate enough rule-based trades, probability laws will work and the system’s edge will emerge.
I know a lot of that is redundant for long-time users and everyone already familiar with the system but it seemed like a good time to post it. Just about everything in that list is discussed in-depth in the Help or one of my previous posts here. But it can’t hurt to reiterate some of these things because the system has a lot of little “nuances” and its behavior varies considerably from session to session.
I could probably add ten more things to that list but let’s move on.
Today wasn’t really a typical session because 3 Alert days are fairly infrequent. Market conditions the last couple weeks of August tend to be dull and things usually return to normal after Labor Day. So I wouldn’t read too much into the price action here until we get into September.
We’ve been seeing a lot of erratic intraday price movement in the market lately.
But this is the perfect time for new users to get acquainted with the system and experience how it handles various market sessions ahead of what’s typically the best time of year for trading – the Fall (seasonally speaking).
The final Alert today came within 1-point of Target 2. Here’s how that looked in the Alert Software.
Notice the “Proximity Meter” next to Target 2 indicated that price was “almost there”. But the market reversed at that point and I drew boxes so you could see how the Trailing Stop “protected” Target 1. That recent enhancement makes a really big difference when the numbers are bigger as you can see in some of the previous posts below on this page.
I started writing this post mid-day which is unusual. I normally wait until after the market closes so maybe that’s why I got a little carried away. I try to post a little bit of insight every couple / few days here but I wanted to welcome the new users and provide a little extra material. And I barely scratched the surface.
I encourage all users, whether new, existing, or potential to read back through some of the past posts – or even go back to some random month and check out my thoughts and how the system was doing at some random point in time. I’ve been posting here every few days since the beginning of 2025 and we’ve been through a lot of market conditions and experienced just about everything possible.
Here’s the page with every “Notes and Commentary” month going all the way back to the beginning of 2025:
If you have any questions about any of this feel free to email me.
A “Summer Doldrums” Session
8/18/2026
It’s going to be difficult to avoid repeating myself because I’ve been talking about how we might expect some dull sessions this month. And today turned out to be one of the dullest sessions so far this Summer.
I talked about “sideways price action” a few times already here but today was about as sideways as it gets. There was almost no directional price movement.
There were a couple early alerts that never triggered-in and then finally, an hour and a half into the session a Short Alert filled. It never hit the Stop and never hit Target 1 by the close. The 4:00 close was a couple ticks below the Entry.
I squeezed the chart down a bit so we can see where the Targets were.
It was a perfectly valid Short Alert. After an hour and a half of erratic choppy price action the price started breaking down. There just wasn’t any follow-through to the downside even though looking at the chart it certainly didn’t look like there was much “strength” in the market today. There was a little bounce after the Alert filled but the Stop started off at a reasonable level – where the trade would be “proven wrong” just above the highs of the morning chop.
I’ve been expecting some sessions like this if you’ve been reading the prior posts on this page. Today was an example of how market conditions can vary drastically from session to session and today was just a “Summer Doldrums” day. The market does what it does and you nor I nor the system has any control over that.
It’s certainly not any reason to get discouraged because as I’ve been saying, the last couple weeks of August tend to have some listless low-participation sessions. That doesn’t mean every one between now and Labor Day will be this dull but it’s pretty much expected to have some this time of year based on years of experience.
Here’s something interesting. As of yesterday there were 15 Alerts so far this month and 80% of them had hit Target 1. Since Target 1 didn’t get hit today we now have 16 Alerts and only 75% have hit Target 1. That’s why a large sample size is important.
If we go back to the beginning of June (when we made some modifications to the logic) there have been 86 filled alerts and 76.19% of them (at least) hit Target 1. That’s a more reasonable sample size and consistent with the “calibrations” we have set. If we go back several years over 1,000 Alerts, even though the logic has been modified numerous times, the hit rate on Target 1 is still right at about 75% because that’s the intended calibration.
It’s important to understand that not every stop-out is a “full” stop-out. That’s because the Trailing Stop tightens prior to Target 1 getting hit probably 70% of the time. So the initial stop tightens quickly when price gets just a bit of “forward traction” in the direction of the trade and reduces risk on the trade. The idea is that we want the initial stop to provide enough wiggle room so that it doesn’t get hit by normal price fluctuation or counter-trend moves.
The system sets the initial stop at a level where a directional move would be proven wrong.
It’s funny, today was so dull I wasn’t even going to do a post. And then it turned out to be way longer than intended so I’ll wrap it up here.
I have lots more to say but I’ll save that for next time.
What A Strange Day – But It Worked Out Just Fine in The End
8/17/2026
In case you noticed there was a glitch at the open today and it took an extra few minutes for the ES / MES Momentum System to come online. There was a gremlin in the system at the open and while we’ve had 99.99% uptime this year there’s always that .01% which was the first 5-minutes this morning.
The good news is that it didn’t affect the Alert which hit both Targets. Here’s the really crazy thing. I was replying to an email right at the open and didn’t notice it other wise it would have only been a 1-minute delay. Then later in the session after the Targets got hit the system stuck again while I was in a Zoom meeting. No worries though, our database guy is on top of it and everything will run smoothly from here on out. I think this is only the second time this year this happened and last time was on a Monday morning too.
The first few hours of the session was painful to watch. MES was clanging around and moving in slow-motion and it was exactly like what I’ve been warning about here as far as dull slow-moving sessions this time of year. But the trend was clearly down and eventually the action picked up to the downside.
I took this screenshot after Target 2 got hit and the Trailing Stop moved the final time.
All things considered today turned out pretty well. Once T2 got hit that was basically it for the day anyway. I told you there would be days like this. There’s nothing worse than when the price action trades sideways for long periods of time and that’s exactly what it did after that. Chalk it up to the proverbial “Summer Doldrums”.
There wasn’t a lot of “momentum” in the market today but price can still “drift” in a directional trend. If I told you that the system would score +25.50 points today would you care how long it took? I will say that it’s unusual for it to take so long for an Alert to play out, but hey – we have to trade what the market serves up from day to day.
A picture is worth a bunch more words – here’s the chart.
Interestingly enough the move from Target 1 to Target 2 was about the most exciting action of the whole day. Once the lows from the morning session gave way it was a fairly quick move lower all the way to T2 before price started consolidating sideways again.
The important thing is that price arrived at the destination we wanted – it just took longer than usual to get there.
As I’ve been saying, the last couple weeks of August tend to see some dull, choppy, low-volume, low participation sessions and that’s just a function of the “seasonality”. It’s been like that for years and we want to keep our expectations in line with current market conditions.
Things always pick back up after Labor Day and quite frankly it’s been a long hot Summer and I’m looking forward to the Fall.
If you’re new here please take some time and read the rest of this page. It’s helpful in understanding some of the nuances of the system a little better.
A Perfectly Reasonable Outcome
8/14/2026
It’s a good day to talk about potential outcomes and mention that an Alert that hits both Targets typically makes up for an Alert that gets stopped-out.
Because that’s basically what happened today. The first Alert got triggered-in on what I call a fake-out move and hit the full stop. The market reversed and the second alert went on to hit both Targets.
The net result for a 2 Contract trader shooting for the two Targets was a loss of -2.75 points on the session. Basically a “breakeven” and has literally no effect on the excellent overall results the system has been achieving recently.
If you’ve been trading the system a while you know that the first alert of the session has a little higher chance of hitting the stop just because sometimes the market moves one way early-on then reverses. But the key word there is “sometimes” and it’s not all that frequent. If you’re thinking it might be a good idea to avoid the first Alert keep in mind a lot of sessions the market picks a direction shortly after the open and never looks back.
If you scroll down this page and look at the screenshots you’ll see plenty that hit both Targets on the first Alert.
So occasionally there’s a fake-out move and that’s just one of the potential outcomes. Somewhere in the help I have a long list of “potential outcomes” for any given Alert and if you add “potential scaling strategies” the list gets even longer. And then there’s the potential outcome of any given session based on the fact the system can issue up to a maximum three (filled) Alerts per session.
But the important thing to keep in mind is that the system has a “statistical edge” that gets revealed over a long series of Alerts and sessions. So any one Alert or market session isn’t important. Anyone that’s been trading a while knows that the “edge” is the important thing and there will be stop-outs, breakevens, small wins and big wins. It just goes with the territory.
An Alert that hits both Targets makes up for one that hits the stop and that seems like a perfectly reasonable outcome.
Done For The Day In The First Hour
8/13/2026
One of the nice things about the Momentum System is that there are lots of sessions where you can be done for the day before lunch.
Of course that all depends on how the price action manifests, but we frequently see days where both Targets get hit early and then that’s it – if you’re trading 2 Contracts shooting for the two Targets.
Days like today the market had significant “momentum” right out of the gate and it made an early trend move higher. Here’s a screenshot of the Alert Software right after Target 2 got hit.
The most interesting thing about today was how accurate Target 2 turned out to be. In other words the trend move higher stalled out and then reversed just above T2. I mentioned a couple posts back about how the idea of the Targets was to maximize the point gain when they get hit and at the same time make them attainable.
It’s all about the calibrations. And every session is different. The logic uses pre-market and opening range ATR’s to calculate the distance to the Targets and it can vary dramatically from session to session. And a lot depends on overall market conditions too.
It’s actually unusual to see Target 1 as far away from the Entry as it has been recently. Over the years during the Summer months T1 averages 3-6 points and market conditions tend to be dull. But if you scroll down this page and look at some of the screenshots you’ll see this year it’s averaging 7-10 points. And we’ve seen sessions where it’s like 14-15 points.
But the real key is the “hit rate” on Target 1 because every Alert that hits Target 1 is a winner.
I talked about that a while back but for the sake of new users I’ll mention again that it’s a perfectly viable strategy to “just shoot for Target 1”. Especially if you’re just starting out with the system and want a super high win rate. Not only does that strategy build confidence but in theory you could only trade the system in the first part of the session and wrap up early and go on to do other things.
Just shooting for Target 1 is kind of like Scalping with the Momentum System. There’s a lot more I can explain about using that strategy but I’ll save it for another post.
I have some things to do this afternoon so today turned out perfect. Once both Targets get hit there’s no reason to stare at the screens all day. It just so happens today that the Trailing Stop also “protected the gains at Target 1”. It got hit a little after 11:00 so the system went offline for the remainder of the session. There are several reasons the system is done for the day when both Targets get hit and price converges with the Trailing Stop but basically there’s no reason to stick around and risk giving anything back.
Call it a win and enjoy the rest of the day.
This Almost Never Happens
8/12/2026
Today reminded me of that old saying from Art Cashin “Today was a waste of a clean shirt and cab fare”.
The market was dull and choppy and just plain boring most of the session. I’ve been warning there would be sessions like this primarily due to seasonality. I took this screenshot of the Alert Software a few minutes before the close.
Notice there were a few green bars lit up in the proximity indicator which meant price was currently a little below the Short Entry the system took this morning. Also notice the dark green bars that extend all the way to the end of the proximity indicator showing how close price had been to Target 1 at one point.
MES hit Target 1 to the tick this morning at 10:32 eastern. ES came within 1-tick of hitting Target 1 so the software didn’t register it. That almost never happens.
Now you know the system uses ES data (for several reasons) but most of us are trading MES. The prices match up to the tick except on rare occasion and it’s even rarer when it would make a difference to the system. If ES and MES differ by a tick it would only matter if that happened right at a Target or Stop like today – very rare.
But the thing is that just like the other day, it was a Trump comment that caused price to spike down for a few seconds and even with a resting order on MES at T1 it’s doubtful you’d get a fill anyway. Just prior to noon today I was thinking to myself that it would be a good day to just close out for a few points and call it a day. If you spent the day in front of the screens you know what I mean.
It was one of those weird erratic dull choppy Summer sessions and that’s just what the market decided to serve us up today. It was actually similar to yesterday early-on with the gap up and fade down, but I kind of expected more real action on CPI day.
The system took a Short this morning 30-minutes into the cash session and by the close it hadn’t hit Target 1 or the Trailing Stop. That almost never happens.
Going into the close it was a coin flip whether price was going to close a few points above or below the Short Entry. It just so happens that it closed -3.25 point over the Entry which was just random.
What a wacky session. Here’s the chart.
Notice the price scale is only in 2-points increments which indicates dull action and small ATR’s. Other than the candles from the CPI release, the opening 5-minutes and the Trump comment the majority of the price action was a snoozefest. Price spent about an hour before Noon chopping around in a 6 point range and that was even more action than from 1:00-2:00.
I talk a lot about market conditions and how we have to trade what the market serves up from day to day. And this was just an example of a session where it didn’t give the system anything to work with.
It happens. Usually during the Dog Days of Summer. No big deal.
So far this Summer – June, July and August – we’re on track for the best Summer ever for the ES / MES Momentum System. A few “nothing days” like today isn’t going to make a difference overall.
A Few Observations From Today’s Alert
8/11/2026
It seemed like kind of a slow moving session but the trend was clearly down all day. There was one Short Alert that hit both Targets but it took a bit of “heat” at first.
Which brings me to the first important point. Even when the market presents us with a trending session, there are usually counter-trend moves along the way. And it’s important to give price a little breathing room so we don’t get knocked-out of a trade that goes on to work.
In other words, if the initial stop is too tight it’s more likely to get hit. So the best place to set a stop-loss is where the trade is clearly proven wrong.
I think you’ll see what I mean on the chart. Check out the notes.
The down thrusts in pre-market and at the open were good indications of selling pressure and there was a bit of follow-through to the downside in the first 15-minutes of the cash session. That triggered-in a Short Alert where I have the Short Entry marked.
When price had a bit of a counter-trend bounce the trade took a bit of heat, but notice the initial stop allowed enough wiggle-room so we didn’t get knocked-out only to watch the market continue in the direction of our trade the rest of the session. The top of that candle was basically where price would have had to go to prove the directional move wrong.
And the system is looking to trade the major directional trend of the day – when there is one. It also takes advantage of smaller “impulse moves” that occur almost on a daily basis. Those are typically the ones that only make it to Target 1. Impulse moves often turn into trend moves and that’s what we saw today.
Notice the price consolidation around Target 1. As I’ve mentioned, the key to the calibration of T1 is we want it to be a “fairly easy to hit” target but at the same time we want to maximize the points when it gets hit. We often see price consolidate or even reverse around the Targets which is a good indication of their accuracy.
The -13.25 points of negative Traction turned out to be minor compared to the +35.75 points of positive traction and I talked about how this is a good way to measure the effectiveness of the Entries in another post recently. Basically the system averages double or even triple (in this case) the positive traction compared to the negative traction which means the Entry strategy is working pretty well too.
One other thing to note about today’s Alert was the number of Trailing Stop moves between T1 and T2.
I took this screenshot right after Target 2 got hit.
The reason there were several extra Trailing Stop moves between the Targets was a function of how price was consolidating and basically just slowly drifting lower. In high-momentum sessions where the Targets get hit quickly there’s usually just 2-3 Trailing stop moves.
The system tightens the stop periodically as price continues to move in our favor, but if the moves are small and price is taking its time with the forward progress then the ratchets tend to be smaller.
The price action in the market dictates how things play out with the Alerts. Further down this page you can see examples of where both Targets got hit very quickly and shortly after the open. Today the market decided to take its sweet time as it meandered down so it took a while for price to hit T2.
Every session is different and the system just reacts to what the price action is doing. We know to expect occasional days with slower price action this time of year but as long as the market makes directional moves the system will do just fine.
What A Weird Day
8/10/2026
I didn’t post Friday because I was getting ready for a big weekend of doing stuff. But it was a typical summer session where there were two Alerts that both hit Target 1. The first one was basically a breakeven but the second one got enough traction to protect Target 1 so the day turned out pretty good considering there wasn’t a lot of action.
Today seemed like a fairly normal Summer session in the morning morning. Nothing too exciting. The market chopped around for the first forty-minutes then made a decent impulse move higher. That was enough to hit Target 1 on the early Long Alert.
That made it 13 Alerts in a row that hit Target 1. 7 of those hit Target 2. That’s a good streak. Target 1 was only 5.50 points today which falls in the “fairly normal” category.
Then something weird happened – Trump Tweeted. I should say he “posted” a comment on his social network, something about demanding war reparations from Iran which caused an anomaly. The following 1-minute candle had a high of 7781.50 and a low of 7764.00 which was 17.50 points and triggered-in a Short Alert.
But it was realistically untradeable. Every now and then there’s a situation like this where something happens too quickly to react and it’s best to just ignore it and pass on trying to trade it.
There was only 1-second between when the Short Alert fired and it triggered-in.
Check this out:
By the time you realized what happened it was too late to do anything and price was much higher than where the system took a fill. I’m certain everyone either missed it altogether or got a fill above where the system did.
Within a few seconds the market bounced quickly, briefly revisited the area where the Alert triggered-in, and then proceeded to basically drift around sideways the rest of the session. That Short never hit Target 1 and it never hit the Trailing Stop into market close.
The whole thing was basically an anomaly.
Here’s the 5-minute chart of the session.
Take a look at the last two candles of the session. Price was only about 5 points above the Short Entry going into the close. Then you can see the rally in the final 5-minutes which put the official close 13 points over the Short.
So that -13 point hit broke the streak of the previous 13 Alerts in a row hitting Target 1. But it never hit the Stop either. Just a weird coincidence.
But the point here is that this was one of those rare occasions where you’d want to just pass on a trade even if you happened to be staring at the chart with your finger on the mouse. We’ve seen a couple similar situations this year where an Alert fires off, fills and hits both Targets in the same 1-minute candle. It’s impossible to replicate the system with these type of anomalies and you’d end up with so much slippage there’s no telling how it would turn out.
A glitch or anomaly like this only happens once in a blue moon and it’s best to just ignore it.
Fairly Typical Summer Trading Session
8/6/2026
Every day can’t be a grand-slam home run. Today was basically a consolidation day for the market and the action was relatively dull. We expect to see some sessions like this in August. Quite frankly we should be grateful this Summer has seen more “decent trading action” than the typical summer months back in the day.
There were 2 Alerts and both hit Target 1. That makes 10 in a row that at least hit T1.
The first Alert was a Long and Target 1 was +8.00 points.
The second Alert was a Short and Target 1 was +7.75 points.
On both Alerts the Trailing Stop tightened prior to T1 getting hit and again after T1 was hit. And as you know once T1 gets hit a trade is generally at “breakeven” assuming trading 2 Contracts shooting for the 2 Targets. Both Alerts ended up with slight gains in that case.
Neither Alert got much Traction past T1 and that was just a function of market conditions. Summer trading conditions were fairly self-evident this morning based on the dull erratic price action and as I always say “we can only trade what the market serves up” from day to day.
But there are a number of ways we can choose to scale Contracts and we can feel free to adjust based on market conditions. Just to give you an idea of how the scaling produces different results…
Trading 1 Contract and shooting for T1 scored a decent +15.75. You could almost consider that “scalp trading” with the Momentum System.
Trading 2 Contracts shooting for both Targets only scored +3.25 points, basically breakeven as I said.
Trading 3 Contracts selling 2 at T1 and holding the other for T2 scored +8.50 on the first Alert and +10.50 on the second for a total of +19.00 points based on where the tightened Trailing Stops got tagged.
Based on the (dull) early price action, once that second Alert hit the tightened Trailing Stop it would have been a good time to go to lunch and not come back (to the screens). That’s fairly typical some sessions here and there during the Dog Days of Summer.
The system did just fine really. As long as Target 1 gets hit there’s no risk of a losing trade. No matter what else, that’s good enough.
Avoiding the Chop
8/5/2026
This morning was a good example of why the system uses the “1-minute close past the barrier” strategy for Entries. And it’s important to know that “not every Alert” fills.
The market chopped around for the first 30-minutes of the session and the software gave several Alerts that never triggered-in based on the Entry strategy. Then the market finally picked a direction about 30-minutes into the session and the Short Alert triggered-in.
Notice on the time stamps there was about 10-minutes in between when the Alert was given and when it finally triggered-in.
As you know an Alert can trigger-in on the very next 1-minute candle close, it could take 5-10-15+ minutes or it could not trigger-in at all.
That’s all a function of the price behavior after the software gives an Alert. You probably noticed how price was basically all over the map and non-directional shortly after the cash open.
The system’s Entry strategy isn’t perfect and sometimes we’ll get triggered into a false move. But as I’ve explained extensively, the strategy helps “confirm” directional price movement. Most trade setups require confirmation and our Entry strategy goes hand-in-hand with all the other logic programmed into the system.
Another good day for the system – both Targets hit before lunch for a substantial point gain.
+9.25 points at Target 1 and +29.00 points at Target 2
If you’re new here don’t get overconfident based on the past few days. The idea is that the system’s “edge” is revealed over a long series of trades and the outcome of any one Alert or market session is basically random. The system attempts to capitalize on directional price moves and it’s up to the market how the price action decides to play out.
It just so happens that lately the market has been serving up nice trends and impulse moves and market conditions have been conducive to trading. I expect there will be some choppy low-volume, no momentum sessions along the way as is typical for the Dog Days of Summer in August. But when everything pencils out at the end of the month I’m confident the system will have done quite well.
So far so good.
If you haven’t read all the posts below yet, now is a good time.
A Rare “Massive Trend Day”
8/4/2026
Days like today are few and far between. At the highs the S&P 500 was up 2% and the whole session was basically a trend-up day with almost no counter-trend moves. We’ve seen plenty of these over the years and know they happen occasionally – but not all that often.
I took this screenshot this morning right after Target 2 got hit.
Basically both Targets got hit in the first half-hour of trading for a gain of +28.75 points (trading 2 Contracts and selling one at each of the Targets). That’s a good trade in a short amount of time and it would have been perfectly reasonable to call it a trading day and go on and do other things.
But we know the Momentum System was designed to take advantage of larger trending days like this and that’s why the system stays online and continues to trail the stop as price moves in the direction of the trade.
The Trailing Stop eventually got hit 5-minutes before the close and here’s what the chart looked like at the end of the day.
It’s impossible to know when these type of trend days will occur but we know for a fact they happen occasionally and always have. They’re just typically few and far between.
The Trailing Stop tightened 27 times in between Target 2 and where it finally got hit at the end of the day. That’s pretty crazy but it’s the way the system is designed and it should make sense that the only way to stay in a big trend move like this is to tighten the stop periodically until the trend finally ends or reverses.
Check out the Traction and where the Trailing Stop finally ended the day.
Everything about today’s session was rare. The system handled it exactly as it was programmed to do.
First Trading Day of August
8/3/2026
Today was a bit unusual but I’ve been saying that a lot lately. The market seems to be making a lot bigger moves than back in the old days where summer trading was typically boring.
There was a big overnight gap-up and when I got to my desk this morning ES Futures were already up around 50 points. In the back of my mind I thought it might be one of those days where the market opens a lot higher and then fades the overnight move. I really wasn’t expecting a huge trend-day move higher off the open.
But that’s the great thing about trading a system. It doesn’t have any bias and just goes by what the price action is doing. It doesn’t try to predict anything, it “reacts” to what’s happening in real-time. And we know what happened. The market ripped higher all session and barely had any counter-trends moves at all.
Both Targets got hit for very respectable point gains before lunch.
The distance to the Targets was significant, +11.50 points to Target 1 and +36.00 points to Target 2.
And the market continued higher even after T2 was hit. Take a look at the Traction in that screenshot. The Long Alert took just -4.75 points of “heat” and got a ton of Traction even past Target 2. As you know, the Traction Indicator shows the maximum positive and negative price excursion measured from the Entry Confirmation (fill).
+66.00 points past the entry is a BIG move.
Notice the Trailing Stop tightened 4 times in between T1 and T2, which is a function of the price action. The third Trailing Stop “ratchet” protected the +11.50 point gain at Target 1 so even if the price never made it all the way to Target 2 the system would have locked-in that gain times the number of Contracts held past T1.
Sideways price action and consolidation generally results in more Trailing stop moves and that’s why there was one additional “tighten” to 7584.00 which was actually a few ticks higher than T1.
Keep in mind that if you were “just shooting for the 2 Targets” you were done for the day once Target 2 got hit. That’s the basic strategy and there’s nothing wrong with wrapping it up there. We actually have quite a few users that like the fact that there are a lot of sessions where the system is finished before lunch.
If you stuck around or looked to see how the session ended up you noticed that the Trailing Stop continued to tighten as price moved higher. An open trade Alert stays open until the Trailing Stop gets hit or the market closes. That’s because some sessions like today the price can move way past Target 2 and “catching a runner” is also a viable strategy.
The Trailing Stop never got hit into the 4:00 close at 7628.25 which was 56.50 points above the Entry. If you pull up the chart and see where the Trailing Stop ended the day it’s pretty amazing. The final TS level was 7625.50 (at 3:35) which is exactly under the pivot low of the final counter-trend move of the day. The Trailing Stop is an integral part of the logic that makes everything “quant out” in the long run.
All in all it was a great way to start off the month of August. I expect there will be some dull Summer sessions between now and Labor Day but today was a good example of what the system can do when the market serves up a nice trend day.
The Momentum System Provides a Statistical Edge
It’s similar to the house odds in Vegas.
The “edge” comes from a combination of the software logic and the strategy we developed for trading the Alerts.
More specifically, the edge comes from a combination of the trade setup, the Entry Trigger and the use of Targets and Trailing Stops. In addition, the way the system is designed to “get trades to breakeven quickly” puts the odds in our favor even more. All these parts fit together and are what gives the System a “statistical edge”.
However, there are considerations that come along with trading this (or any other) system. It sounds easy but it’s important to maintain the right mindset and take the correct approach.
You want to think in terms of probabilities when trading the system. The outcome of any one Alert or trading session is purely random and at the mercy of how the price action manifests after we enter a trade. It’s important not to be swayed by short-term results and take a longer-term perspective. The systems “edge” is revealed over a long series of trades.
There will be stop-outs and there will be breakeven trades. There will be winning days and losing days. Focusing on the immediate wins and losses are not consistent with trading a system that has a quantifiable edge. If you think in terms of probabilities, it doesn’t matter whether the next trade is a win or a loss or a breakeven. We want to focus on the long-term statistical advantage rather than individual results.
Wins and losses are mere data points and there’s no need to be overjoyed or disappointed in the outcome of any one Alert.
Short-term results are random. The law of probabilities works over a large sample size to bring out the system’s edge.
August Should Be Another Great Month for the System
Last month turned out to be one of the best months for the ES / MES Momentum System since it’s inception over a decade ago. That’s because we made some slight modifications to the logic back in June which improved things dramatically. As you know we started off by upgrading and improving the Alert Software “interface” and beefing up the back-end that runs the system. Then we dug into the logic that runs everything and implemented a few things that I’d been discussing here.
Primarily “protecting gains at Target 1 when price gets close to Target 2”.
Those of you that have been around for a while remember sessions where Target 2 was like 36 points and the price would get as close as 34.75 points but not quite make it. The “old way” was that the Trailing Stop would have the trade around “breakeven” or perhaps hanging way back around the Entry.
That was fine in the bigger scheme of things back when all the numbers were much smaller. But the past year or so we’re seeing much bigger distances to the Targets given the volatility in the market and the fact that ES in the 7,000’s means larger point swings intraday simply based on the fact the nominal number is so much larger than years past.
Anyway, modifying the “aggressiveness” of the Trailing Stop was long overdue and I’d been talking about it for a while on the blog and we finally implemented it into the logic in June. It turned out to be a huge improvement.
The system has been doing great ever since version 5.0 was released and just had a couple of the best months ever back-to-back.
As we get into August I’ll be using this page to post commentary, notes and charts relating to the Momentum System and trading strategy and whatever else comes to mind. This “notes section” of the website isn’t intended to be a daily recap, but usually gets updated with new material every couple / few days. It’s a good way for me to be able to post educational material and examples to help new and existing users make the most of our system. Check back every few days.
Additional Useful Information
Moving Beyond the Trade Setup – Futures Trading Strategies to help Increase our Odds – In-Depth Article
July 2026 Commentary – Notes – Education – Examples
PowerEmini Day Trading Futures – Automated Alert Signals