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 Wild Week to End the Month
2/28/2026
The last week of February was an unusual one to say the least. As I’m writing this on Saturday (the last day of the month), there’s a new conflict in the Middle East which is most certainly going to affect markets going into March.
But I just wanted to briefly talk about how the system handled last week because it was certainly unusual. All in all I’d say things turned out quite well but there were two back-to-back days where ES and MES produced different results. The post below describes the day that ES hit the stop and MES didn’t. Then the following day the exact opposite happened. MES hit the Trailing Stop on the one Alert of the session but ES didn’t and went on to hit Target 2.
You can read below how unusual I thought it was that happened even once, but the same thing occurring the following day is a true anomaly. In all these years we’ve had the system running I’m not sure I’ve seen more than one or two instances where ES and MES differed at the exact level of the stop. So I wouldn’t worry much about it because these rare anomalies tend to even out over time just like so many other things. For instance trading the system it’s inevitable there’s going to be some slippage. And some times you’ll get a better fill than the system and sometimes not. But it should all even out over a longer period of time.
So last week 6 of the 7 Alerts hit Target 1. 4 out of the 7 hit Target 2 only counting one of the anomaly sessions hitting T2.
Friday was a strange session also. The first Alert hit the full stop and the second one just hit T1. And the third Alert hit both Targets but Target 2 didn’t get hit until 3:59:52 just 8-seconds before the cash close. But it did get hit and that basically made up for the stop-out. Sometimes the last day of the month is weird and honestly the overall market has been a little weird lately.
I’m sure you’re aware that the daily chart shows the market has essentially been trading sideways in a relatively narrow range all year so far. The S&P 500 has been sandwiched in between 6800 and 7000 for 2-months now and there’s been absolutely no trending action on the daily timeframe.
Maybe that’s about to change?
ES vs. MES – Sometimes It Matters
2/24/2026
Today was an example of a rarely seen anomaly. ES and MES price differed by a couple ticks at an exact level where it mattered.
The system (and software) run using ES data even though the Momentum System is designed for trading MES. The same is true for the other symbols too. Part of the reason is that we originally created the software before the Micros even existed, but mainly because the full size Contracts are basically “the standard” and trade more volume.
As you know the price can vary between ES and MES by a tick or two here and there and it rarely affects the system. But today ES hit the (tightened) Trailing Stop to the tick and MES missed it by 2-ticks. That’s extremely unusual and it almost never matters because it only matters to the system if the difference occurs right at the level of a Target or Trailing Stop.
So when ES hit the Trailing Stop the system reset and was done for the session since the market immediately reversed and continued higher. Trading MES with a stop at 6848.75 would not have resulted in the stop getting hit since the low of that candle was 6849.25.
So in reality this Alert ended up hitting both Targets trading MES (just like yesterday’s alert) and it just goes to show that there’s always going to be some differences between the numbers in the software and what happens in real-life trading. It’s something to be aware of and consider. It’s similar to the slippage we encounter on entries and exits.
Here are the System Notes that show when ES hit the Trailing Stop:
This “anomaly” actually worked in our favor due to the fact MES went on to hit Target 2.
But keep in mind there’s always the possibility of the opposite happening. Given a long enough timeframe it’s likely there may be an instance where ES hits a Target and MES doesn’t quite make it. But these kind of anomalies are pretty rare.
Best to not sweat a couple ticks here and there.
A LOT Can Happen In A Minute
2/20/2026
I was going to start this post with yesterday’s choppy session and show the crazy zig-zag price action and mention how sometimes the market just doesn’t give the system anything to work with. There were 2 stop-outs and one decent trade that hit T1, but the price action was horrible and really a mess. But it’s Friday night and it seems like it’s been a long week and I thought about just waiting until next week to post.
But today was highly unusual and I’d regret it if I didn’t post this chart of what transpired. There’s probably only a handful of times in a given year where we’d see something like this.
The system gave a Long Alert that hit both Targets in the same 1-minute candle.
This is one for the record books and was the result of a “news event”. At 10:00 eastern time the Supreme Court rendered its opinion on tariffs. There was some advance notice that today might be the day, but it wasn’t set in stone. So this is the type of move we’d expect to see over a Fed announcement back in the days where the market actually went haywire on Fed Day. (more recently Fed Days have experienced muted reactions).
But the fact that both Targets got hit in 1-minute and the fact that the Targets were a significant distance from the Entry made for quite an interesting session. But the most impressive thing was the way that the Alert Software handled it. Like I said “A LOT can happen in a minute”.
Take a look at the System Notes from today: (read the notes from the bottom up)
10:06:55 ES Momentum System Offline
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10:06:55 Trailing stop hit at 6879.00 – System Reset
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10:02:00 Trailing stop move to 6879.00
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10:01:26 Aggressive Protection Level 6882.50
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10:01:26 Target 2 hit at 6916.50
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10:01:11 Target 1 hit at 6891.50
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09:43:00 T1 = 6891.50 T2 = 6916.50
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09:43:00 Entry Confirmation 6881.00 – Initial Stop 6863.00
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09:37:27 LONG – Trade Price Barrier 6873.50
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09:35:00 ES Momentum System Online RH = 6864.75 RL = 6847.25
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Friday, February 20, 2026 – ES Momentum System – March 2026 Contract
Notice the “seconds” in the time stamps where the Targets were hit. And check out the time between when the Alert was given and it filled – and the time between when it filled and hit the Targets.
T2 got hit 15-seconds after price hit T1 and there’s no telling where you got filled, but there was potentially a lot of slippage in our favor.
Yes, it was completely unexpected and not normal price action at all since the move was a result of a “binary event”.
But who knows when we’ll see anything like that again?
Volatility At The Point of Entry – Big ATR’s
2/18/2026
It’s already Wednesday because of the President’s Day Holiday weekend and the volatility continues. The ATR’s recently have been larger than normal. The two trading session prior to today were a mixed bag, which is typical of 3-day weekend. Both days there were 3 Alerts of which 2 just hit Target 1 and the middle one hit the Stop. But the numbers were big. The market is in a period where the intraday swings are huge and the price movement on smaller timeframes reflects that too.
I wanted to talk about that today because the numbers were also big. And even though today’s Alert hit both Targets there was sizeable “negative price excursion” before the trade went in our favor. So I’ve talked a lot about how “everything is relative” meaning that the distance to the Stop and Targets are based on the current ATR’s in the market. I’ve also talked about the “max stop” and why we use it. And today turned out to be a good example of why the system sometimes uses a wide stop – to avoid getting knocked-out of a trade that goes on to work.
Basically if we set our stops too tight, they’re just going to get hit by “normal price fluctuation” and random price movement. Check out the price fluctuation around today’s open on the 5-minute chart and the ATR’s (ranges) on the early candles for perspective.
Notice the ATR’s were ranging from about 14-18 point every 5-minutes and that was the “normal price fluctuation” in the first 30-minutes of trading. If you think about it, logically when we enter a trade we want our initial stop to be far enough away from the price action that it doesn’t just get hit by normal random fluctuation. The system typically achieves that by placing the initial stop 1-tick past the opposite side of the Range. But as you know, we determined that an 18 point max stop is optimal because “you have to draw the line somewhere”.
So today’s max stop allowed just enough “wiggle room” for the trade to work out without hitting the initial stop. And if you look at the chart again, the early price action wasn’t all that unusual – except for the fact that the ATR’s were so significant. The system initial max stop was just a tad over the average 5-minute ATR. What’s more, the trade took a little over 16 points of “heat”. By that I mean negative price excursion, which is displayed in the Desktop Alert Software as Negative Traction.
I marked the Traction Indicator up near the top in case anyone wasn’t sure what I was talking about. Basically taking that much heat on an Alert is kind of unusual but in the context of the average ATR’s “it’s all relative”. When price is fluctuating 14-18 points every 5-minutes it makes for an “elevated risk – elevated reward” session. Imagine getting stopped-out and then watching the price make a huge move in the direction you wanted. That happens a lot and typically it’s the result of using too tight of a stop compared to the price fluctuation.
At the risk of repeating myself, “the tighter the stop the more likely it is to get hit”. Today everything went just right and the price action unfolded in a way that illustrates why sometimes it’s beneficial to give price plenty of “wiggle room”. And why I say it’s all relative. An 18 point max stop seems big but compared to average price fluctuation during periods of high volatility it’s not.
Keep in mind that the downside risk is fixed and the upside potential is unlimited. There was an Alert last April where Target 1 was 21.00 points and Target 2 was 70.50 points and both got hit. That was the second alert that session and the first one hit the max stop. That’s just an example of how extreme things can get and let’s hope it doesn’t come to that again. There’s a sweet spot of volatility and it’s a bit less than we’ve been seeing recently.
But with ES trading near 7000 we have to expect “bigger nominal numbers” and larger price fluctuation. I talked about that in some of the posts below.
You Never Know What’s Going To Happen Next
2/12/2026
Today turned out to be a pretty wild session. But we had no way to know that in advance. This past year I’ve made some comments about how we never know what market will do next when we’re trading live and watching the price action unfold. Today was a pretty good example of that which is evident on these two charts.
The first chart shows what everything looked like early in the session after price hit Target 2 definitively. Price actually hit T2 “to the tick” where I marked the label but it’s always questionable whether we can get a fill when that happens. Anyway this is the “before” chart.
So looking at that we can say it was a pretty decent trade. Obviously the trend was down shortly after the open and while there seemed to be a bit of volatility, that last candle showed some nice follow-through. Target 1 got hit 4.50 points away from the Entry and Target 2 got hit 14.75 points below the Entry. That seems like a fairly respectable trade.
But we all know what happened next. Here’s the “after” chart.
So right after T2 got hit, the market proceeded to collapse with an astounding 11 5-minute candles in a row with lower highs and lower lows. Yesterday there were seven of those and I commented how “extremely unusual” that was. I don’t even know what adjective describes that move today.
So the Targets look minuscule on that chart compared to what transpired after they were hit. But obviously we had no way of knowing that would happen and while I could describe a couple ways one might have captured the move past T2 in hindsight, I’ll leave that up to your imagination. Basically today was an example of a “runner” which is simply a move that goes well past T2.
The low of the session prior to the (tightened a bunch of times) Trailing Stop getting hit, was 115.25 points below the Entry. The Trailing Stop eventually got tagged 81.75 points below the Entry. These kind of days are few and far apart but they do happen. And that’s why the system stays online and continues to tighten the Trailing stop even after the Targets get hit. It is possible to catch runners but we have to realize these type of moves are infrequent. There are lots of times where the Targets get hit and that’s it – price reverses.
The system did its job today. It provided a Short Alert early on and calculated the Targets based on the early price action and ATR’s. Looking at the first chart everything looked normal and just how it should. But the market decided to serve up a “long range day” and there was no way to anticipate it in advance. But it demonstrates how every now and then there are huge moves past the Targets and how we might consider thinking about strategies for capturing those moves when they happen.
The Parabolic Stop
2/11/2026
I figured today would be a good session to talk about the Parabolic Stop since we don’t see it all that often. The market has to make an extreme directional move in a short amount of time in order for the system to fire off a Parabolic Stop move. Parabolic Stops only get issued when market momentum is extreme.
“The Parabolic Stop move occurs when we see price momentum and trajectory accelerate very quickly to extremely Overbought/Oversold, i.e. unsustainable short-term levels.”
Note that the Parabolic Stop move only shows up in the System Notes and when it gets hit it doesn’t close the trade and reset the system. It’s just a good level to consider locking in profits on any Contracts held past Target 2. Generally speaking there’s about a 50/50 chance the first Parabolic Stop will get hit as it did today. But if price continues to move in the same direction there can be a series of Parabolic Stops that will appear just above the previous 5-minute high (on a Short like today).
What was interesting about today was the serious “downside momentum” that began about 20 minutes into the cash session. Notice there were seven 5-minute candles in a row with lower highs and lower lows. That’s extremely unusual and a good example of a “parabolic move”. Also note the time stamp on the Parabolic Stop in the Alert Software screenshot that I superimposed on the chart. It actually kicked-in 2-minutes after the last red candle of that impulse move and in a case like this it would have been advantageous to use that for any Contracts held past T2 because it’s essentially designed to lock-in max profits on an unsustainable move like we saw today.
Choppy Price Action
2/10/2026
I use the phrase “choppy price action” here a lot and today’s chart provides a good illustration of what I mean by that. But more importantly it shows why we have the system set to issue a maximum of 3 filled alerts per session.
The reason for that is sometimes the market just doesn’t present us with good trading conditions. And there’s no reason to stick around continue to keep attempting trades in sub-optimal conditions. The market was a mess this morning – choppy and all over the map.
2 out of the 3 filled Alerts hit Target 1 and the other one hit the tightened Trailing Stop on a candle that traversed the entire range after coming pretty close to T1. The price action was such a mess I had trouble marking everything on the chart.
As traders we are beholden to how the price action unfolds and some sessions the market just doesn’t give us much to work with. The system was lucky to hit T1 on 2 out of 3 today.
But notice how the top of the Range lined up well with the highs of the pre-market. The system did its job and Alerted us to the breakouts above that resistance, but the first Long only got within a couple ticks of the Target before price snapped back down and hit the tightened stop. That was some really hectic price action right after the cash open and there was really no rhyme or reason to the price moves. Just a bunch of nasty long-range candles that were “all over the map”.
A perfect example of why the system called it quits after 3 Alerts. When the price action is a mess there’s no reason to stick around and get chopped-up.
Opening Drive Alerts
2/9/2026
The past couple days (today and Friday) were examples of what we call “opening drive” Alerts. And the numbers were huge like they’ve been most of the month so far. Basically when the cash session opens and price makes a huge directional move right out of the gate, that’s the opening drive.
Opening Drive Alerts aren’t all that common and I’d say they occur maybe 20% of the time. With more typical price action the cash session opens and the price tends to clang around in the Range for a bit and then poke out or break out one way or the other. Many times price bounces around and stays contained in the range for about 15-30 minutes. Maybe it pokes out the top and / or the bottom and then finally the market picks a direction and we see a trend move. But when the market just rips in one direction right from the start and continues in that direction it’s a little trickier.
The system is programmed so that it will give an Alert when there’s a strong opening drive because we don’t want to miss a big directional move. It’s typically not as ideal of a setup as when we get more normal consolidation around the open and then a trend develops. The opening drive moves are when the market just rips in one direction off the open and they tend to last about 15-20 minutes and then there’s typically a counter-trend move.
Here’s what the opening drive move looked like today.
Notice the opening drive lasted about 20-minutes before that first red candle that poked back down into the range. Also notice that the “fill” on the Alert was 6.00 points past the Alert price, which is significant. But the numbers have been huge lately and I’ve been talking about the recent extreme volatility all month. The distance to Target 1 was 9.00 points today and the distance to Target 2 was a whopping 30.00 points.
It turned out to be a nice persistent trend day and the Trailing Stop eventually worked its way above Target 2 before it got tagged.
So Friday saw a very similar move where the price just ripped higher out of the gate and the system gave an Alert on the opening drive.
But Friday the Alert got thwarted because the initial stop was too tight and too close to the price action. And the volatility was even more extreme than usual. Basically it was a case where the max stop was just too tight for the ATR’s and you can see how it got hit on just a normal counter-trend move. If the ATR’s hadn’t been so huge, that one would have worked out just like the one did today.
But if you’ve read the posts below, you know that over a long series of trades it makes sense to have a max stop because as I said “you have to draw the line somewhere”. The opening 5-minute candle was 36.50 points Friday. Today it was 18.50 which is still significantly more than normal but a little more reasonable.
Another thing about an opening drive alert is that the Alert and Entry are likely to be further outside of the Range than normal. That’s because when price is just ripping in one direction the system is trying to determine whether it’s going to just “keep going” or whether there’s going to be a reversal. There’s a time element to it and the result is that the fill on the Alert can be a lot further away from the Range than is ideal. The system is programmed so that it just doesn’t automatically try and jump into a trade right from the get-go. Because typically there’s some price consolidation near the open for say 10-15 minutes (sometimes longer) and its trying to validate any directional move.
But when there’s huge momentum in one direction like we saw the past two sessions it doesn’t want to miss out because many times the market just continues to rip in the same direction and never looks back. But more often there’s a counter-trend move which is fine as long as it isn’t a full blown reversal. And that can happen too.
So there’s nothing wrong with getting Alerts on opening drives like this. You can see how well it worked out today. But Friday’s stop out was more the result of the initial stop being too tight and you can see that price eventually did work its way to both Targets.
The similarity between the two sessions is uncanny.
But let’s hope things settle down a little bit because this “extreme volatility” isn’t ideal. The numbers are really big and that makes for a “huge risk / huge reward” environment.
Big Numbers – And Lots To Unpack
2/5/2026
I’m starting this post early today because there’s a lot to say about how the morning session played out and a a bunch of stuff I want to cover. This morning before Noon (eastern) there were 2 Alerts that triggered-in, a Long and a Short. Both hit Target 1 and then the tightened Trailing Stop.
The distance to Target 1 on the Long Alert was 12.50 points. The distance to Target 1 on the Short Alert was 9.50 points.
That’s what I meant when I said “big numbers”. That’s 2-3x the distance to T1 in normal market conditions.
So this morning’s price action ties into what I was discussing in yesterday’s post in a couple different ways. Actually it’s a good example of what I’ve been talking about all month so far. The first thing is the “extreme volatility” and (much) larger than normal ATR’s. And also the max stop and the mid-point of the range and all the things discussed in previous posts.
So the first thing I want to talk about is the idea of “just shooting for Target 1” when the market conditions are crazy volatile. Yesterday I mentioned the section in the Help about “Trading Extremely Volatile Market Conditions”. One of the strategies mentioned on that page is “just trading 1 MES Micro Contract and just shooting for Target 1”. That strategy resulted in a +22.00 point gain this morning and at that point it probably would have been a good idea to call it a day. That’s about equivalent to a Target 2 winner on a more normal day where the ATR’s weren’t so big.
The other thing was something I mentioned yesterday about using the mid-point of the Range for the initial stop if the 18 point max stop scares you or seems to large for your taste. Both the Alerts this morning hit Target 1 without any “negative excursion” back to the mid-point of the Range. But here’s the crazy thing. On the Long Alert the mid-point of the Range was 24.50 points below the Entry – more than the max stop. But on the Short Alert the mid-point of the Range was only 13.25 points above the Entry – a bit less than the max stop.
But the idea is exactly what I said yesterday. The “majority” of Alerts that go on to hit the Targets tend to have very little “negative price excursion” and that’s just something to consider during periods of extreme volatility.
It also seems like a good time to reiterate that the Momentum System will issue a maximum of 3 “filled” Alerts per session. You should already know that from reading the Help, but that’s one of the nuances that doesn’t always get picked up right away by new users.
And that’s something else I wanted to talk about. Over the years we’ve considered changing the “maximum number of filled Alerts per session” to 2 instead of 3. But here’s the dilemma. When price volatility is low and the Range is say 8-12 points, it’s not uncommon to have a couple Alerts that both hit Target 1 or one hits the stop early-on and then eventually the major trend of the day reveals itself. In those cases the third Alert of the day often goes on to hit both Targets.
If we limited the max number of filled alerts to 2, there would be sessions where the system missed out on the big moves. On the other hand it would eliminate the possibility of getting stopped-out 3 times in a session when price action is extremely choppy and just zig-zags all over the range. That’s not really a big deal when the numbers are small and honestly it’s extremely rare to take 3 full stop-outs in a session. It usually only happens a couple / few times a year.
But when the numbers are big, it’s a big deal. So on days like today when the max stop is in play, you might consider only taking 2 Alerts and calling it a day. We can’t assume that if there’s a third alert it will go on to hit both Targets. Sometimes the price action is just rotten and that makes for sub-optimal trading conditions. And by the way, in crazy volatile markets like we’ve been seeing, it’s ok to choose to skip an Alert here and there or sit on the sidelines. Or trade really small. Or use different stops.
Rather than suppress Alerts or have the system go offline, we’ve always thought it best to just run it wide-open no matter what. That way the user can decide to use some discretion and we aren’t forcing the system to make judgement calls. That’s why we don’t shut it down early on Fed Days.
But it’s important to realize that periods of high volatility are different than normal, average market conditions and that’s when it’s not a bad idea to consider using some discretion – consider playing defense. Today was a good example of when it might be beneficial to “just shoot for Target 1” or “just take 2 Alerts and call it a day”. I know I’m saying this in hindsight but these are strategies we’ve included in the documentation for years and can be useful in periods of extreme volatility.
Too Much Volatility To Handle
2/4/2026
The past two days were stellar days for the system so it was due for a rough session. The big difference was really market conditions. Monday and Tuesday the market made huge directional trend moves, while today it was excessively “choppy” in early trading.
Choppy is ok except when price is zig-zagging up and down 15-20 points every 5-minutes. It’s a coincidence that a couple days ago in the post below I talked about this exact thing. We know the price action manifests differently every market session, but there are “market environments” where the ATR’s / ranges / price moves are abnormally crazy. And we’ve been seeing that lately.
So after two great sessions to start the month, today the system got chopped up by the excessive size of the ATR’s. There was a full stop-out, an Alert that hit Target 1 and then another stop-out. It happens, but what’s worse is that the third (and final) Alert got knocked-out by the fact we have a set “max stop” and if it hadn’t been for that it would have ridden the trade all the way to Target 2.
But we have to draw the line somewhere. A few years back around the time of Covid if I recall, we decided that the system needed a “max stop” because without it, there were sessions where it just wasn’t feasible to set the “initial stop” on the opposite side of the Range. As you know, the initial stop on any given alert always starts off 1-tick past the opposite side of the Trigger Range. If you think about it and experience enough sessions you’ll see that level makes perfect sense because it’s basically the point where a directional move is invalidated.
But back then we started seeing sessions where the range might be 25 or 35 or more points. And like I said, setting a stop that wide just isn’t feasible, even for the Micros. So we set out to figure out what the best “max stop” would be and came up with 18 points after testing years of data and all sorts of different scenarios.
But it’s important to realize that sometimes 18 points is “too tight of a stop” for the price action. Seems crazy right? But as I said, you have to draw the line somewhere and that’s the value that quants out best over the years based on our testing.
So when I say that sometimes using an 18 point max stop is “too tight for the price action”, here’s what I mean. Just look at the ranges on these 5-minute candles this morning.
ES Futures 5-minute ATRs on 2-4-2026
The arrow points to the candle that hit the max stop and knocked-out the Short trade. Price never moved back to the top of the Range subsequently and eventually hit Target 2 about an hour later. In other words, having a “max stop” thwarted this trade. The alternative would have been using a 25.25 point stop that – as it turned out – would not have been hit. But we never know… what price will do next.
So should we do away with the max stop?
Well I suppose if you really wanted to, you could choose to use the standard “opposite side of the range” initial stop when the max stop is in play. After all, the system notes showed everything you needed to do that. But we chose to program the system with “fixed risk” on any given Alert and sometimes that thwarts a trade.
I’ve talked about this a lot in the past, but it seems like a good time to bring up the idea that “the tighter the stop, the more likely it is to get hit”. Look at those ATR’s again and imagine trying to use a 1 or 2 point stop. It would get hit (probably) every time. To say it another way, the likelihood of a stop getting hit is a function of the distance from the entry and the ATR’s of the timeframe you’re trading. That’s why it’s not feasible to use 1-tick stops.
But here’s a little something that I almost never talk about. I’m reluctant to even mention it but I suppose you should know… The NQ / MNQ Momentum System doesn’t have a max stop. The reason is that when we first introduced the fixed max stop into the ES system we wanted to see the difference it made between the two symbols.
In other words we wanted to see how many times the max stop would get hit on one instrument as opposed to the other instrument without a max stop. Also we wanted to determine the optimal max stop for NQ before we set one and never really decided on one. Somewhere in the 100-150 range seems about right, but we never actually settled on an exact number. So the NQ system runs wide open with no max stop and today was one of those days where it made a difference.
Take a look at the Traction Indicator at the top of this screenshot from today and notice NQ took 114.25 points of “heat” prior to the Short Alert going on to hit both Targets and then some.
As you know I almost never post about NQ here because I try to keep things simple. If I start posting about different symbols here and get even further into the weeds discussing the scalper then it could get confusing really quick for new users. And as you know, we originally created the system based on ES before the Micros even existed and we recommend new users start off with MES. (Also NQ tends to trade more erratically). But I just wanted to point out how employing a max stop on ES while running NQ with “no guardrails” made a difference.
Over the past year I’ve discussed the idea of using a different stop than the system at times but it’s always been in the context of using a “tighter stop” than the system. I don’t think it’s a good idea to ignore the max stop on MES and use the wider stop (on the opposite side of the range) but if the 18 point max stop is “too much” and causes anxiety I have a suggestion.
Based on my observation over the years, the mid-point of the Trigger Range is typically a viable level to set the initial stop “much of the time”. If we programmed the system to use the mid-point of the range as the initial stop, the result would be a much lower win rate because we’d get stopped-out of a lot of trades that went on to at least hit Target 1. But then again I can say that a good majority of the alerts that go on to hit T1 never reverse past the mid-point of the range in the opposite direction. If one were to employ this advanced strategy, it would require re-entering the trade after a stop-out if price triggered again in the original direction.
What I’m trying to say is that a good majority of the Alerts that hit Target 1 take almost no heat. They have very little or no negative traction. But it’s a double-edged sword. Because… the tighter the stop, the more likely it is to get hit.
We actually have a page in the Help that gets into “discretionary tactics” for periods of extreme volatility so I won’t get into that too deep here. Basically when you see the initial stop inside the range that means the max stop is in play and that should send up a caution flag. You might choose to trade a little differently under those circumstances and we have a lot of good tips in the Help for that.
There are a few other things that are relevant to the topics I’ve mentioned so far but I don’t want to make this post too long. I’ll save them them for future posts. I have some good educational and conceptual topics to cover that are directly related to everything I discussed above.
More on that next time.
February 2026 – New Month – Updated Version
2/2/2026
About a week ago we released an update to the Power Emini Alert Software and indicator. Your software (and companion indicator) should show v4.8 now and if you still have the old v4.7 please email me and I’ll send the update instructions.
It’s actually a minor update that improves the “connectivity protocol” on the back-end to make the data faster and more stable. As I mentioned in last month’s notes, it also lays the foundation for an upcoming “upgrade” that’s going to be a big deal. We’re improving the user interface to be more modern and it will have some really cool new bells and whistles. The upgrade is coming later this Spring.
For now, The Alerts in this recent v4.8 “update” haven’t changed at all. We did make some tiny changes to the look so that if you have the “Color Tabs for Alerts” checked in the Settings, you’ll notice on Long Alerts the active tab will be green and you’ll see a green border around the main section of the software like this:
For Short Alerts you’ll notice the tab and borders are red. So that’s just a tiny little visual change to help differentiate this update.
We’ve had the Momentum System running about 10 years now so I have a pretty good idea of what the average month looks like as far as the market’s “personality”.
The nominal ES price level is more than twice what it used to be just a few years back. So the point moves and ATR’s and general price volatility near ES 7000 are going to be extremely elevated compared to when it was trading in the 3000’s. But keep in mind that a 1-point ES move is still $50 no matter what the price level is.
It’s a good thing we have the Micros.
It makes sense that the market moves more points these days, but I also attribute some of the increased volatility to the news cycle. Some of the wildest price moves we saw last year were based on news releases that just came out of the blue and hit the tape. Recently we’ve seen the 18 point “fixed max stop” in play more than normal and it’s important to realize that means the market conditions aren’t really “normal”.
Some new users see that 18 point stop in play on a given day and that kind of startles them because hey, 18 points used to be a big move.
But just keep in mind that even with today’s “elevated” nominal price levels, we’re still probably only going to see the max stop on occasion like today. The numbers you see in the screenshot above are not normal. Those huge distances to the Targets and the max initial stop are likely to be temporary.
When the market settles down things will return to normal (if there is such a thing) and we can go weeks or months and never see the max stop come into play. On sessions where it is in play it’s important to keep things in perspective. More risk – more reward. The numbers can get really big when the market is abnormally volatile. There are times where that max stop is less than 1 ATR and we’ve seen instances where 18 points is “too tight of a stop” for the price action. Keep in mind there’s no upside limit to the Targets.
Today, the first trading day of February, Target 2 was 37.50 points away from the Entry. That’s not typical, but the system adjusts everything based on the current ATR’s.
Now that we’ve started a new month, I’ll be using this page to post commentary, notes and charts relating to the ES / MES Momentum System, our 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 place for me to post educational material and examples of how the Momentum System handles different market sessions.
Check back every couple / few days for updates.
Additional Useful Information
Moving Beyond the Trade Setup – Futures Trading Strategies to help Increase our Odds – In-Depth Article
January 2026 Commentary – Notes – Education – Examples
PowerEmini Day Trading Futures – Automated Alert Signals