The signal from the Motion Encoder Cart and Receiver (DTS-MEC) is exactly the same as that from our Rotary Motion Sensor (RMV-BTD). As a result, you can use the sample Arduino sketch VernierRotary. This sketch is included in our collection of Arduino sketches and is discussed at:
http://www.vernier.com/engineering/arduino/digital-sensors/rotary-motion/

Basically, the program looks for pulses on pins 1 and 2 of the BTD connector. One counts up and the other counts down.