Welcome to The Discovery Trading Group

 Announcements  Comments Off on Welcome to The Discovery Trading Group
Nov 292011

We are a group of professional and amateur traders founded by principals of a quantitative research firm which develops strategy and periodicity diverse programs and risk modeling tools. Our own internal process involves using this webspace as a collective resource for sharing both discretionary thoughts during intraday sessions and as a sort of virtual think tank for our ongoing quant research. A big part of that research has consistently shown that the ‘Holy Grail’ of the purely mechanical, single market intraday trading strategy that produces near linear returns without significant ongoing adaptation DOES NOT exist. As such we have found that for most traders pursuing single market intraday strategies, an adaptive, risk management focused discretionary approach is likely to bear the most fruit. Ironic, given that rigid, purely mechanical systems are what the vast majority of retail traders (including us at one time) seem to be in relentless pursuit of. 

In the spring of 2010 we created a private, member only forum behind the blog devoted to our ongoing discussions related to discretionary analysis of market structure, price action and order flow to like minded retail traders as a sort of experiment. Since we have always found the format in which we use this space privately to flesh out ideas to be so beneficial, we wondered if it might be even more fruitful to increase the sheer numbers of those participating in this process and with that, DTG as it exists today was born. By any measure, the experiment has been almost unfathomably successful for us in terms of it’s role in keeping us sharp in whatever discretionary or quantitative work we happen to be engaged in at the time. Sharing our experiences and interacting with the greater numbers continues to spark new ideas for all of us, making our little experiment a huge win on all fronts in our book. For information about the type of trading that is the foundation for what most members are focused on here, follow this link:

Methodology Framework

 Posted by at 11:24 am

04/01/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 04/01/2020 ES Trade Plan Worksheet
Apr 012020

During Trump’s daily coronavirus briefing on Tuesday, he warned that the US may suffer 100K to 240K deaths.  The US death count is currently just above 4K making the projections huge and the end of the virus crisis seem far off.  The US has already surpassed China’s 3.3K death count while Italy is approaching 12.5K and Spain is surging with over 9K deaths.  Global cases are approaching 875K (645K active) and the US 189K (177K active).

Factory data from around the world are showing that the global economy is slumping.  Yesterday closed out the first quarter as the worst since the 2008 financial crisis.  The DOW’s 23% slide was the worst since 1987.

The economic calendar is full, ADP @ 8:15am ET, Final Mfg PMI @ 9:45am ET, ISM PMIs and Construction Spending @ 10:00am ET, and Oil @ 10:30am ET.

Volatility continues to shrink and remain high, but there are a lot of analysts voicing opinions that the US and global market selloffs are not over yet.  Could the ES be looking at breaking 2000 in the near future or is all the negativity a sign that the bottom could be forming?

Size bias is short into the US session open.


 Posted by at 6:54 am

03/31/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 03/31/2020 ES Trade Plan Worksheet
Mar 312020

Focus remains on the surging coronavirus cases and deaths.  Globally, the number of cases is approaching 800K and 39K deaths.  The US has surged to nearly 165K cases and 3200 deaths.

In New York City alone, the virus-related deaths jump from 138 on Sunday to 914 on Monday.  NYC has over 38K cases, more than half New York state’s 67K.

Almost three fourths of US states have issued stay in place for their residents.  Maryland’s Governor Larry Hogan said, “We are no longer asking or suggesting that Marylanders stay home; we are directing them to do so.”

Airlines are being urged by the Treasury Department to submit an application for relief funds this week.  The government is asking for each airline to detail “appropriate compensation” for the relief funds which includes the government taking a stake in the airlines.

Retail furloughs are beginning.  Macy’s (M) is furloughing about 125K employees, Kohl’s (KSS) about 85K or their 120K employees, and the Gap (GPS) about 80K of their 129K employees.

Ford (F) and GE together will make 50K ventilators in the next 100 days.  Ford (F) said they would continue to make 30K ventilators a month for as long as needed.

The economic calendar include C&P/CS Composite HPI @ 9:00am ET, Chicago PMI @ 9:45am ET, and Consumer Confidence @ 10:00am ET.

Volatility continues to shrink but remains high.

No Size bias as Globex volume was both mixed and lighter than recent.


 Posted by at 7:05 am