Momentum Lab, explained

1 · Overview & quick start

Momentum Lab scans extended-hours movers lists — the top 50 gainers and 50 losers from each data source, refreshed every 15 seconds — for significant price movements, tracks qualifying opportunities in real time and can execute your configured momentum strategies automatically. It watches US stocks, runs three strategies — each with its own settings, limits and statistics — and lives in the dashboard at /dashboard/momentum.

Its job is not to predict. Its job is to apply your rules to every candidate it picks up, the moment they qualify, with a deterministic record of what happened and why — something a person watching a few screens at 6:45 AM cannot do.

Quick start — the safe path

1. 1Be on the Elite plan. Other plans can open Momentum Lab as a preview, but cannot enable paper or live execution.
2. 2Make sure you have real-time extended-hours data — see Market data. Without fresh data, entries stay blocked.
3. 3Open /dashboard/momentum, pick a strategy and read every parameter against the tables below before you enable it.
4. 4Run it in Paper. The strategy logic is identical to Live; only the execution adapter differs.
5. 5Review the analytics for that parameter version, adjust, and let the new version build its own record.
6. 6Switch to Live deliberately — it takes a typed confirmation — and know where STOP MOMENTUM TRADING is before the bell.

2 · Plans & access

Momentum Lab is part of the Elite plan. Accounts on Free, Starter and Pro can open a preview, but cannot enable paper or live execution. The check is enforced on the server, not only hidden in the interface.

Compare plans on the pricing page.

3 · Market data — what Momentum Lab needs

Momentum Lab trades only on real-time data it can verify. It works from your connected broker's data — Interactive Brokers market data, or an Alpaca account with a real-time consolidated feed — or from a supported premium data provider. It never trades on scraped web pages, and a feed that reports itself as delayed is never traded on.

What every quote carries

Each observation records its timestamp, source, bid/ask, last trade, session and freshness. A price without an exchange timestamp is never traded on, and entries are blocked whenever the newest quote is older than your stale-data threshold (default 10 seconds).

4 · Sessions & New York time

Everything runs on the exchange clock — America/New_York — not your device's time zone. Daylight-saving changes, weekends, exchange holidays and shortened sessions are handled for you; if you trade from outside the US, the sessions simply move relative to your local time when the clocks change.

5 · States & duplicate-entry protection

Each symbol has one deterministic state per strategy and trading day, and only defined transitions exist. A stock that crosses its trigger a second time finds its existing state rather than a fresh one, so the same move can never produce a second entry. Another entry in the same stock happens only under your re-entry rules (default: one entry per symbol per day, then a 30-minute cooldown).

6 · Premarket Momentum Breakout

The primary strategy. It watches US stocks during premarket (4:00–9:30 AM ET) and measures each one against a reference price — by default the previous official regular-session close. When a stock crosses the trigger (default +5.00%) on fresh data and every check passes, it enters; the exit then trails 0.50% below the highest price reached after the fill.

7 · Momentum Reversal

Finds extreme premarket movers that start to reverse — both extreme gainers turning down and extreme losers turning up. The extreme (the premarket high for a gainer, the low for a loser) is tracked continuously. Once the move from the reference price reaches the minimum (default 8%), the stock is ARMED; it triggers when price has come back 1.5% from that extreme on consecutive fresh quotes. A gainer turning down is a short; a loser turning up is a long.

8 · Opening Momentum Continuation

Watches strong premarket movers (default 5% or more) into the 9:30 AM ET open, then waits for the confirmation you choose — a premarket-high breakout, an opening-range breakout, holding above a premarket level, or the VWAP relationship where data is available — alongside the usual spread, liquidity and volume checks and optional AI confidence. Default exit: a 0.5% trail.

9 · Shared parameters

Every strategy has its own copy of the settings below, so each can be tuned independently. Defaults are the values a new strategy starts with.

Universe & liquidity filters

A value the data source cannot provide never passes a minimum that is switched on — “unknown volume” is not “enough volume”.

Position sizing & exposure caps

Exits

Every strategy needs at least one exit. Price-based exits act only on fresh data; time-based exits (exit time, max holding time, session policy) fire even when data is stale.

Order handling

Re-entry

Data quality, AI & strategy risk

10 · Trailing protection — Broker Native vs PatternX Synthetic Trail

PatternX chooses a position's protection once, when the entry fills. The trailing order rests at your broker — shown as Broker Native — only when all of these hold: Live mode, Prefer native trailing on with a trailing distance above 0, an entry filled in the regular session, a broker that supports native trailing orders then, a session policy other than continuing through after-hours, and the hard emergency stop set to 0. Otherwise — including with the default 3% hard stop — PatternX runs the PatternX Synthetic Trail: it tracks the high-water mark continuously on its servers and sends an extended-hours-compatible exit order the moment the trail is hit. The high-water mark is stored server-side, so it survives a restart.

Outside the regular session most brokers accept only limit orders, so exits go out as marketable limit orders priced through the quote and are re-priced on each retry until they fill — see Order handling above. Where your broker accepts a stop order in that session, the hard emergency stop can also rest at the broker alongside a synthetic trail.

A worked example

1. 1The entry fills at $10.00. With a 0.50% trail, the trail starts at $9.95.
2. 2The price climbs to a high of $10.80. The trail follows to $10.746 (0.50% below the high).
3. 3News hits and the next trade prints at $10.60 — straight through the trail. The exit order goes out immediately.
4. 4It fills around $10.60 or lower: about 1.9% below the high, not 0.5%. Had the price fallen right after the fill, a gap could likewise turn a 0.5% trail into a larger loss than 0.5%.

Illustrative arithmetic. PatternX records the gap between the trail level and the actual fill as slippage, and shows it in your analytics — it is never hidden.

11 · Data quality, filters & skip reasons

Market Cap Safety Filter — checked first

Every strategy carries a mandatory minimum market cap, so the default configuration never enters very small companies automatically — where liquidity, spreads and volatility are hardest to manage. The order is fixed: candidate detected → market cap → liquidity, volume and spread → the strategy's own conditions → risk limits → PatternX AI (if on) → entry.

A stock exactly at the minimum passes; anything below it is skipped and recorded as “Skipped — Below minimum market cap”. Market cap comes from your data source — Interactive Brokers reports it, and so does the platform Polygon feed where PatternX provides one; Alpaca does not publish market cap. When no current figure is available (including ETFs, which have none, or a figure more than 72 hours old), the stock is skipped as “Skipped — Market cap unavailable”: a missing market cap never counts as a pass. The filter is in addition to every other check below, never a replacement for them, and changing it saves a new parameter version so analytics show which threshold admitted each trade.

Every trigger then passes the same gates — data quality, liquidity and universe filters, risk and capacity limits, the optional AI filter and the broker. A stock that fails is never dropped silently — it is shown with a label and the exact reason.

Data, broker, position-limit and AI skips can clear on their own; they are re-checked after the retry delay (default 30 seconds).

12 · Paper vs Live

Paper and Live run identical strategy logic — the same detection, filters, sizing and exits. Only the execution adapter differs: Paper simulates fills against live quotes from a virtual balance (default $25,000); Live sends real orders through your broker connection.

1. 1Momentum Lab starts in Paper. Use it until you understand how your settings behave in a real premarket.
2. 2Switching to Live requires an explicit typed confirmation — it can never happen through a stray tap.
3. 3The current mode is always shown prominently, so you always know whether real money is at work.

13 · Kill switch — STOP MOMENTUM TRADING

One control, four effects:

• • Disables new entries immediately, across every strategy, until you resume.
• • Cancels eligible pending entry orders.
• • Keeps existing positions visible — nothing disappears from view.
• • Lets you choose separately whether to exit those positions.

14 · Automatic circuit breakers

Breakers stop Momentum Lab from opening new positions without waiting for you. Account-wide limits apply across all strategies; the per-strategy loss and losing-streak limits are under each strategy's settings. Loss, trade-count and error limits trip for the rest of the New York trading day; data and broker failures pause new entries only while they last.

15 · PatternX AI (optional)

The deterministic market-data engine must detect a real price move first — PatternX AI never manufactures a price event. When you switch it on, it ranks or filters those genuine opportunities using volume, relative volume, liquidity, spread, volatility (the move against the stock's normal range), market regime (SPY movement), news and catalyst context with Alpaca data, and — once there are at least five — your own results on similar setups.

A factor with no data is left out rather than guessed, and an opportunity needs at least two known factors to pass. The AI filter can only remove or rank an opportunity; it cannot create one, and it never loosens your filters or limits.

16 · Analytics & parameter versions

Each strategy reports trades, win rate, average win and loss, profit factor, expectancy, net P&L, maximum drawdown, average hold time, average slippage, best and worst trade, maximum favorable and adverse excursion, exit reasons, and premarket versus regular-session results.

Results are attributed to the exact parameter version in force when each position was opened. Changing the trigger from 5% to 7%, or the trail from 0.5% to 1%, creates a new version — earlier trades stay with the version that produced them, so two different strategies are never blended into one set of numbers.

17 · Backtesting

Backtests replay real extended-hours history — one-minute bars — through the same strategy and exit logic as the live engine, wherever your data source provides that history. Where it does not, there is no backtest: nothing is fabricated.

Test combinations side by side — for example entry thresholds of 3, 5, 7 and 10% against trailing distances of 0.25, 0.5, 0.75, 1 and 2% — together with maximum-spread, premarket-volume, market-cap-preset and (for Opening Momentum Continuation) opening-confirmation variations.

18 · Limitations — read before going Live

• !Momentum Lab applies rules; it does not predict prices. A move can reverse at any moment, including right after an entry.
• !Extended-hours markets are thinner: wider spreads, smaller displayed size, sharper moves and more slippage than the regular session.
• !A trailing distance, an emergency stop or a take-profit decides when PatternX acts, not the price you get. Gaps, halts, rejected orders and partial fills can all produce a materially different exit.
• !Brokers differ in what they accept outside regular hours — order types, native trailing stops, stop orders, fractional shares and short selling.
• !A PatternX Synthetic Trail depends on PatternX, your broker connection and your market data. Breakers pause new entries during an outage; they cannot guarantee an exit.
• !Without a real-time extended-hours entitlement, Momentum Lab will not trade — by design.
• !Paper and backtest results are hypothetical and usually kinder than live fills.
• !Momentum Lab covers US stocks. It is software, not a broker or adviser, and nothing it shows is investment advice.

19 · Troubleshooting

More answers in the Help Center — or message support from the dashboard.