This editor mode gives you finer control over track data. Instead of keyframes, you sculpt the raw track data itself at any resolution you want.
To motion edit, you select a time range of one or more tracks, then tweak the properties that those tracks represent to manipulate track data. You can also cut / copy / paste ranges of time, or save the selection as a separate .movie file.
A time range selection describes how much a modification affects each moment in time. It's broken up into three parts:
To make and update a selection:
You can change the easing type of the fade in / out sections with the corresponding button in the toolbar, or pressing number keys when mousing over those sections. The shape of the top / bottom of the time selection UI shows what the current easing function looks like.
After selecting a time range, you can manipulate the properties of your movie's tracks. Only the selected time range will be affected, with the changes ramping up and down inside the fade in / out sections of your selection.
The selection will turn yellow to show a modification is in progress. At this point you can freely tweak the time selection, and when you're happy hit Enter or click the green tick to commit the change.
The context menu for time selections has a ton of extra editing actions.
When pasting a time selection, you can additively layer track data over the existing animation. This is enabled by default, can can be disabled by clicking the Additive button in the toolbar while modifications are active.