Welcome to The Discovery Trading Group

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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

04/02/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 04/02/2020 ES Trade Plan Worksheet
Apr 022020
 

Initial US market focus is on the 8:30am ET Unemployment Claims as the economic reality of the coronavirus manifests.  Estimates have a huge range, from less than 1 million to over 6.5 million.  Trade Balance @ 8:30am ET and Factory Orders @ 10:00am ET round out the economic calendar.

Coronavirus cases now top 950K and over 48K deaths.  The US has surpassed Italy and Spain combined in cases as exponential growth now tops 215K.  The US now has nearly 29% of the world’s active cases.

Oil prices are up about 10% after President Trump after he said he’s confident Saudi Arabia and Russia would work it out and that he plans to meet with US oil companies on Friday.

Boeing (BA) is offering voluntary layoff (buyout and early retirement) packages as the company struggles to stay afloat financially from the double whammy of their 737 MAX problems and the coronavirus.

Volatility continues to shrink but remains high by historical standards.

Size bias is long into the 8:30am ET Claims number on light Globex volume.

 

 Posted by at 6:58 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