A position sensing mechanism provided by the invention comprises an encoding element as a sensing signal source, a reading element for sensing signals of the signal source, and a processing unit for receiving and analyzing sensing signals output by the reading element, the position sensing mechanism has a main technical feature lying in a magneto-resistive unit in the reading element for sensing signals of the signal source being a tunneling magneto-resistor (TMR), and two layers of magnetic moments of a reference layer and a free layer of the tunneling magneto-resistor being perpendicular to each other, and in the reference layer and the free layer with the magnetic moments being perpendicular to each other, the magnetic moment of one of the layers is parallel to a film surface, and the magnetic moment of the other layer is perpendicular to the film surface.