Power Emini Commentary – Notes – Education – Examples
We started a new thing in 2025. 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 Quick Refresher From Today’s Session
9/11/2025
Every now and then I like to reiterate one of the most important points when trading the Momentum System – how to take the Entry.
This is for the benefit of new users and prospective users and just to make certain everyone understands how it works. This is actually the first thing to know when you start using the software.
Some Alerts don’t get filled. Not every Alert “triggers-in”.
It’s understandable when a new user first gets the software and sees the first Alert fire off to think that it’s a trade. But it’s not. There’s a very specific “entry strategy” the software uses and it only takes a minute to understand it. But I like to reiterate and clarify it from time to time because it’s such an important aspect of the system.
And today was a good example to show an alert that didn’t trigger-in.
So here’s the “entry strategy”.
When the software issues an Alert, the very next 1-minute that closes at least 1-tick past the Trade Price Barrier (Alert Price) triggers-in the trade. Simple as that.
Here’s the play-by-play in the System Notes section of the Alert Software.
So this morning there was a Short Alert at 9:45 as you see in the screenshot above, but there was no 1-minute candle that closed at 6552.25 or lower. (6552.50 was the Short Alert level).
Price poked through that level, but never closed at or below it on the 1-minute timeframe.
Price then reversed higher, that Short Alert went away and 7-minutes later the system issued a Long Alert that did fill.
There are 2 main reasons the system uses the “1-minute close past the Alert price” to trigger-in a trade. (Entry Confirmation)
1) That gives us time to react. You can see it took 2-minutes from the time the Long Alert was issued for it to fill. Some Alert fill on the very next 1-minute closing candle and others can take 5-10+ minutes to fill – or not fill at all.
2) It helps prevent getting sucked in to a false move. When price closes a tick or more past the “barrier” on the 1-minute chart it helps confirm momentum in that direction. Sometimes like today price will just poke through the Alert level but there’s no 1-minute close. Sometimes price will poke through the barrier multiple times and sometimes there’s just a millisecond poke through it.
This is an ideal way to confirm a trade and it’s discussed in more detail in the Help. When an alert fills the software instantly prints the line “Entry Confirmation” using the close of the 1-minute price bar that closed at least a tick past the Alert Price.
So here’s the chart where we can see the Short Alert level that didn’t trigger-in and you can see how price just briefly poked through that level.
(That’s a 5-minute chart but when you get an Alert you want to monitor the 1-minute chart for the Entry. After an Alert gets filled we recommend switching to a 5-minute chart to follow the trade as it plays out.)
So you can see the dashed red line where the Short Alert fired off at 9:45 and that was the one 1-minute candle that “poked” below the Alert price for just a few seconds. The Alert never filled and price reversed quickly and 7-minutes later the Long Alert fired off and filled a couple minutes later.
The Long Alert then went on to hit both Targets and it turned out to be a great session for the system.
In the post below you can see how yesterday’s session differed because the first Alert of the session did trigger in even though the primary trend of the day ended up being in the opposite direction.
However, (and this is the beauty of the system) the first alert hit Target 1, the trailing stop tightened and even through price reversed the trade was just a “breakeven”. Then the second Alert of the day basically caught the major trend.
I don’t want to get too far into the weeds in explaining all the nuances of the system in this post, but it’s important to know how the Entry strategy works. It’s kind of a unique way to confirm which Alerts fill and which don’t, but it makes a lot of sense if you think about it.
Anyone that’s been using the software for any length of time knows exactly how the system takes an entry on a trade, but occasionally there’s some confusion and I wanted to clarify things so no one makes an execution mistake.
So Far So Good
9/11/2025
I meant to post this yesterday evening but I got tied up with other things. Fall is finally in the air and I’m looking forward to turning off the a/c and opening the windows. Autumn is a great time of year here in N. Florida because we typically get about 3-4 months of perfect weather. And the market conditions tends to improve. The “action” picks up.
So far this week has been just ok, but now that the important economic numbers have been released everyone’s looking forward to next week’s Fed announcement. That’s sure to spark some action since it’s debatable on whether they lower by 25 or 50 bps. I’m thinking the market action really heats up after that.
The reason I’m posting yesterday’s chart is because I wanted to point out something important.
So there were 2 Alerts and both hit Target 1. That’s about par for the course.
But that second Alert got triggered-in mid-session and price took about 2-hours to meander its way to Target 1. And then another hour and a half to get within 1-tick of Target 2.
Close but no cigar. Missed it by 1 lousy tick.
But looking at the chart from a common sense perspective, it would have made perfect sense to go ahead and close the trade somewhere around where I drew that shaded box. After all, the market was 20-30 minutes away from the cash close and there was a good 15 or so points of profit to be had.
It’s perfectly reasonable to say “close enough” and close the trade in a case like this where the market is going to be closing soon anyway. Especially after the “slow drift” that took half the day to make it to the Targets. The fact the market has been sort of in slow drift mode so far this week was another good reason to call it a day early.
It’s actually pretty interesting that Target 2 was literally right at the level the market made it to and found support before reversing into the close. That means the distance to T2 was calculated pretty darn accurately, but not exactly precise enough apparently.
This is the second time recently that price came within a tick or two of T2 but didn’t quite make it. And in those cases I think it makes sense to use a little judgement and think about protecting profits rather than being a “stickler” for a tick.
That’s where gauging market conditions comes in . In fast markets where there’s tons of action and price is moving with purpose, the Targets or stops typically get hit quickly. In slower markets where price just “drifts” it can meander around for hours. That’s a “low momentum” environment and it might make sense to use a little judgement. This was a good example of where that would have made the difference between a breakeven day and a decent winning session.
Weekend Update and Random Thoughts
9/5/2025
It sure seemed like a long week even though there were only four trading days.
The market action also seemed particularly choppy even though there were a couple decent trends that developed. What was a bit out of the ordinary was that there were 10 Alerts even though it was a short week and only 5 of them hit Target 1. And only 2 hit Target 2. Needless to say that didn’t lead to a spectacular week overall. There was a trailing stop that got hit to the tick and a stop-out that got hit by just a tick and those made a difference.
Usually price hitting Target 1 is like shooting fish in a barrel but occasionally the price action thwarts an Alert here and there and that’s just the nature of a system that provides exact numbers. I always talk about using tighter stops and then we get a situation where the stops are too tight by a tick or two. When the initial stop tightens at Target 1 getting hit it reduces risk. But some Alerts get knocked-out by the tightened stop that wouldn’t have otherwise.
I’ve been pondering that dilemma this week. As I’ve said here many times, trading is all about compromise and over the long run it’s preferable to reduce risk by having stops tighten as quickly as possible. So the compromise is that the tighter the stop the more likely it is to get hit. It’s like that regardless of what strategy you’re using. As I like to say “that’s why we don’t use 1-tick stops”.
Statistically speaking, the closer a stop is to the current price action the more likely it is to get hit. That’s just math. Same with Targets. If we wanted a 90% or higher “hit rate” on Target 1 we could just set it at a few ticks. But the idea is that we want to maximize on the point gain while still maintaining the “easy to hit” distance and that’s why the system is calibrated so that Target 1 gets hit 75% of the time.
The other 25% of the time that T1 doesn’t get hit doesn’t mean it’s a full stop-out because the Trailing Stop tightens prior to T1 getting hit about 75% of the time. It depends on the approach. In other words if price meanders and slowly approaches T1 the stop will tighten when it gets about three-quarters of the way. This reduces the risk on the trade but also moves the stop closer to the price action which means it has a higher chance of getting hit.
In normal market conditions T1 is generally 4-7 points away from the Entry. Once Target 1 gets hit the Trailing Stop tightens an equal distance so that the trade is at breakeven (assuming trading 2 Contracts shooting for the 2 Targets). So all in all this strategy works great over a long series of trades but the outcome of any one trade is essentially random and at the mercy of the price action that manifests after we take the trade. So it’s important to realize that any system with an “edge” requires a large sample size for the edge to be revealed.
Conceptually, the system eliminates the risk of a loss by tightening the stop to breakeven and that’s what provides the edge over the long-run.
So the proper mental approach is to avoid getting discouraged by rough patches where the Targets don’t get hit as frequently as they will over the long-run. This past week coming off a Holiday weekend T1 only got hit 50% of the time instead of the average 75% going back 2-years. That’s why sample size is important. In the past we’ve seen streaks where T1 gets hit 8-10 times in a row and the record is 18 in a row. It’s not uncommon to see streaks way above the 75% hit rate.
Winning streaks frequently follow periods where the system just spins its wheels or has a drawdown.
So on both the Alerts that went on to hit Target 2 last week the first Alert of the session got stopped-out.
Here are the charts.
On the chart above there was a sharp down move caused by 10:00 economic news that got just enough follow-through to trigger a Short but price quickly reversed, hit the stop and the system then went Long. The dashed lines are the levels where the Alerts were given and the thin red and green lines are where the Alerts triggered-in. Even on trending days it’s possible to get sucked into a false move, but the system is good at catching a move in the opposite direction when that happens.
While playing the exact numbers in the software with 2 Contracts resulted in a small loss for the session, a little fancy footwork could have resulted in a gain. In other words trading a larger position on the 2nd Alert or holding past T2 are a couple strategies that could have worked out. The Trailing stop never got hit and the closing price was +34.50 points past the Entry.
Here’s the chart from Friday where the market opened above the all-time high and then had a significant sell-off in the early session.
There’s a lot going on with this chart but you can see I drew a white box around the 5-minute candle that traversed the entire range and caused the first Short to hit the stop by 1-tick. Just two candles later the system re-fired the Short Alert which went on to hit both Targets very quickly. But the Targets were a bit closer-in than normal based on the ATR’s of the prior candles. At the time it was impossible to know that the sell-off would pick up that much momentum.
As you can see in the Alert Banner, price actually got +80.25 points of “traction” to the downside past the Alert price at the low. What was really interesting was where the Trailing Stop eventually ended up just above the base the chart pattern formed. That’s where the Trailing Stop eventually got hit prior to the close.
This was another situation where the system had the right idea and did its job, but the way the price action unfolded wasn’t ideal. In other words the initial ATR’s and the Range were relatively small so all the tolerances were a bit tighter than normal. The distances to the Stop and Targets were fairly small based on the prior candle ranges.
Regardless, these couple examples got me thinking about how it would have been possible to take advantage of the huge trend moves that eventually developed. And the main idea I came up with was that you would have had to stay in the moves past Target 2. In most cases that’s easier said than done because frequently price hits T2 and doesn’t make much additional forward progress or reverses. But in both these cases it appears that trailing a stop just past the low or high of the candle that hit T2 would have kept the trade open for what we call a “runner”.
Of course that’s a discretionary tactic and I wouldn’t recommend trying that every time, but it does illustrate what’s possible. Especially on Friday’s sell-off where there were ten 5-minute candles in a row with lower highs than the previous candle. That’s actually pretty uncommon and requires a lot of directional “price momentum”.
Anyway, it’s encouraging to see the volatility pick up and this coming week we get the CPI and PPI numbers and those are very likely to create some good action in the market.
September – Summer is Over
Summer market conditions weren’t all that bad this year. There were some dull periods and a handful of choppy sessions, but overall it seemed like a better trading environment than lots of past years.
September is traditionally when market participants and institutions get back to their desks and the market action picks up. We should start to see increased volume, participation and “range expansion” and that’s ideal for trading. Actually the first trading day of September saw this exact type of action and that’s a good sign.
As we get into September 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 way for me to be able to post educational material and examples of how the Momentum System handles different market sessions.
Additional Useful Information
Moving Beyond the Trade Setup – Futures Trading Strategies to help Increase our Odds – In-Depth Article
August 2025 Commentary – Notes – Education – Examples
PowerEmini Day Trading Futures – Automated Alert Signals