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    An observer, such as a microprocessor, will read (sample) the output of the encoder. The observer needs to sample the encoder output often enough so it does not miss any code changes. If the encoder turns too fast, then the observer may miss an encoder output change, so the observer will see an invalid transition, such as 00 → 11, and be confused. For that transition, the observer does not know which way the encoder turned: it may have gone forward (00 → 01 → 11) or backward (00 → 10 → 11). If the encoder is turning even faster, then multiple output changes could be missed, and the observer may get the direction wrong. Consider the moving forward sequence 00 → 01 → 11 → 10 (3 steps forward). If the encoder is turning too fast, the observer may see only the first (00) and fourth (10) outputs and conclude the encode made a legal 00 → 10 transition (1 step backward).
    This same principle is used in ball mice to track whether the mouse is moving to the right/left or forward/backward.
    Rotary encoders with a single output (i.e. pulsers) cannot be used to sense direction of motion. They are well-suited for systems that measure rate-of-movement variables. In certain applications they may be used to measure distance of motion (e.g. feet of movement).

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