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

07/18/2019 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 07/18/2019 ES Trade Plan Worksheet
Jul 182019

Market focus remains on earnings.  Netflix reported their first reduction in subscribers in 8 years putting pressure on NFLX, the first FAANG stock to report 2nd quarter earnings.  DOW component CSX also reported weaker than expected earnings and cited the drawn-out US/China trade war as impacting their business.  Earnings on deck today include UNH, HON, UNP, MS, and MSFT.

Weak manufacturing and business sentiment data from Japan has the Nikkei 225 down 2%.    Oil prices fell more than 1% yesterday after the Crude Inventory Report should a larger than expected build.

The economic calendar focus is the 8:30am ET Philly Fed and Claims.  The Fed’s Williams speaks @ 2:15pm ET.  Volatility increased to the downside yesterday which should remain the easier direction for today if the ES can get into the 60s.  Size bias is bullish into the US session open on higher than recent Globex volume.


 Posted by at 6:02 am

07/17/2019 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 07/17/2019 ES Trade Plan Worksheet
Jul 172019

Market focus is on earnings.  JPM, GS, and WFC all beat expectations yesterday.  Bank of America (BAC), USB, PNC, and BNY Mellon (BK) are on deck.  Netflix (NFLX) kicks off the FAANG stocks after the bell.  Microsoft (MSFT) reports as well.

Bitcoin has fallen nearly $5K since it’s July peak as US lawmakers grilled Facebook yesterday over their Libra crypto currency.  Central bankers and regulators have been expressing doubts over digital currencies, even Trump weighed in saying they were “based on thin air”.

The economic calendar is light with focus on 8:30am ET Building Permits and Housing Starts.  Oil @ 10:30am ET may get some extra attention as storm Barry reduced production in the Gulf of Mexico.  There’s also the Fed Beige Book @ 2:00pm ET.

Volatility continues to contract as the ES hovers under it’s all-time high.  Reaction to this morning’s bank earnings should set the initial market mood.  Size bias is long but like yesterday, Globex volume is very light.



 Posted by at 7:12 am