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

08/21/2019 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 08/21/2019 ES Trade Plan Worksheet
Aug 212019

It’s a Fed day with July meeting minutes released at 2pm ET.  Analysts will dissect the minutes for clues to future interest rate reductions under continued pressure from President Trump who said “They have to do a rate cut” and if the Fed would do it’s job “you would see a burst of growth like you’ve never seen before.”

A payroll tax cut idea is also being floated, Trump told reporters “Payroll tax is something we think about, and a lot of people would like to see that”, then adding “we’re very far from a recession.”

Walmart sued Telsa for solar panels that have caught fire on 7 of their stores between 2012 and 2018 causing millions in damage. Inspections found loose wiring from shoddy manufacturing which created fire hazards.  Alibaba (BABA) is delaying an IPO seeking $10B to $15B in new capital on the Hong Kong exchange due to all the political unrest in Hong Kong.  Retail remains in focus for earnings: TGT, LOW, JWN, SPLK, ADI, and LB.

The economic calendar includes Existing Home Sales @ 10:00am ET and Oil @ 10L30am ET.  Volatility is shrinking and should continue to do so if the ES moves up.  Size bias is long into the US session open.


 Posted by at 6:34 am

08/20/2019 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 08/20/2019 ES Trade Plan Worksheet
Aug 202019

The US gave China’s Huawei Technologies a 3-month extension to continue purchasing US company parts which is taken as a sign that tensions in the US/China trade war could be easing.  President Trump continues to counter recession fears “We’re doing tremendously well.  Our consumers are rich; I gave a tremendous tax cut and they’re loaded with money.”

In an effort to beat Disney to the market with a streaming service and develop original programming, Apple’s spending soars past $6B, well past their estimated $1B.  As an example, Apple spent several hundred million on a morning show featuring high price stars Jennifer Anniston, Reese Witherspoon, and Steve Carell.

Baidu (BIDU) is up 9% premarket after beating earnings expectations despite falling 62%.  Home Depot (HD) stock is flat after being earnings but their $30.84B in quarterly earnings fell just short of expectations.  Retail earnings continue: KSS, TDL, TJX, URBN and MDX.

For the second day in a row, no significant US economic data scheduled.  Volatility shrank yesterday and the trend should continue today unless the bears take over.  US markets may go into a wait mode as the Fed minutes will be released tomorrow.  Size bias is short into the US session open on lighter Globex volume than recent.


 Posted by at 6:37 am