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

07/09/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 07/09/2020 ES Trade Plan Worksheet
Jul 092020
 

The US reached a record 59.400 new coronavirus cases yesterday, the 5th record in the last 9 days.  US deaths have climbed to over 132K.  Initial market focus is the 8:30am ET Unemployment number where more than 1.3M are expected to file for the first time bringing the US total to over 48M since the coronavirus outbreak in mid-March.

Google (GOOGL) has canceled plans to create isolated cloud services which enables countries to control their own data.  The spotlight is China where escalating geopolitical tensions have made the market too “sensitive”.  The “Isolated Region” project given Google a way to setup shop in China.

Bed Bath & Beyond (BBBY) is down nearly 9% premarket after announcing they would close nearly 200 stores over the next 2 years.  There first quarter sales were down 49% due to COVID-19.

Eldorado Resorts (ERI) received approval from the Nevada Gaming Commission to take over the larger rival Caesars Entertainment (CZR).  The acquisition would make Eldorado the largest US gaming operator.

The economic calendar is light; in addition to Claims @ 8:30am ET, Wholesale Inventories is @ 10:00am ET.

Volatility continues to shrink as the S&P 500 struggles to move higher.

Size bias is bullish into the 8:30am ET Claims number on very light Globex data.

 

 Posted by at 7:22 am

07/08/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 07/08/2020 ES Trade Plan Worksheet
Jul 082020
 

On Tuesday as US coronavirus cases crossed 3 million, the SP 500 ended a 5-day bullish streak.  Meanwhile the Fed’s VP Richard Clarida told CNN that the Fed has more they monetary accommodation that they can do if the US economic recovery should start to stall.

Walt Disney (DIS) said they would no change their plans to reopen Disney World in Orlando on July 11 despite the recent surge in coronavirus cases in Florida.  The park will be opened to a limited number of guests who will be required to wear face coverings.  Disney has changed park policies to include more cleaning and disinfecting and updated their health and safety policies.  Disney’s chief medical officer Dr. Pamela Hymel said “we have reimagined the Disney experience so we can all enjoy the magic responsibly.”

Movie theater operator AMC is close to a deal with their creditors to stave off bankruptcy.  The coronavirus has forced AMC to shut down more than 1000 theaters.  AMC is looking for their bond holders which includes Apollo Global Management (APO) to provide a $200M senior loan and swap their unsecured debt for a new second-lien debt.

Facebook (FB) met with boycott organizers to resolve the #StopHateforProfit movement that has 100s of brands pulling their Facebook advertising for July unless Facebook changes their policies on hate speech, voter suppression and misinformation.  The group had 10 demands, but the only demand CEO Mark Zuckerberg and COO Sheryl Sandberg would agree to was hiring a person with a civil rights background.  The one-hour meeting ended with little resolved.

The economic calendar is light with focus on Crude Oil Inventories @ 10:30am ET.

Despite Tuesday’s selloff, volatility has started to shrink.

Size bias is short into the US session open on much lighter Globex volume than recent.

 

 Posted by at 6:42 am