Welcome to The Discovery Trading Group

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Nov 292011

We are a group of professional 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

03/19/2018 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 03/19/2018 ES Trade Plan Worksheet
Mar 192018

A land deal in Japan appears to be threatening PM Shinzo Abe’s leadership and a good chance for a Fed rate hike this week have the stock markets in a bearish mood overnight.  It’s a Fed week and new Fed Chair Powell’s first rate hike decision will be released on Wednesday.  Facebook is down over 3.5% pre-market as US lawmakers begin attacking social media companies for what they are calling “data breaches” of private data.  FB claims the claims are completely false. FB users voluntarily provided their information through an app they specifically downloaded for that purpose.  The data is tied to Trump’s 2016 election campaign.  Nothing of note on the US economic calendar.  Extra attention may be given to Atlanta Fed President Bostic’s 9:40am EST talk at a Miami conference for any insight into Wednesday’s rate decision.  Volatility continues to contract, however expect it to pick back up if the bears start taking control.  No Size bias as overnight trading was mixed, although on last check, Size bias is starting to lean bearish.


 Posted by at 7:41 am

03/16/2018 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 03/16/2018 ES Trade Plan Worksheet
Mar 162018

Concerns over a brewing trade war between the US and China have put a damper on the bulls, special counsel Robert Mueller subpoena of Trump’s businesses with potential ties to Russia, and speculation that National Security Adviser H.R. McMaster will soon depart the White House have markets in a defensive mood.  The economic calendar focus is Building Permits @ 8:30am EST, Consumer Sentiment and JOLTS @ 10:00am EST.  Corporate earnings continue to beat estimates, on deck as the season comes to a close are TIF, HIBB, PERY.  Volatility remains elevated, although the ES 5-day ATR has shrunk to 36 from over 100 last month.  From a day-trading perspective, an ATR of 36 is much better than the under 20 we dealt with most of last year.  No size bias this morning as overnight trading was mixed.


 Posted by at 7:06 am