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

02/18/2019 Presidents Day

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Feb 182019

Today, Feb 18, 2019 is Presidents Day.  US stock markets are closed.  DTG will resume posting tomorrow, have a great long weekend!

 Posted by at 6:06 am

02/14/2019 ES Trade Plan Worksheet

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Feb 142019

Chinese exports are up 9.1% in January while US imports into China have fallen 42%, a large part due to their embargo of US soybeans.  There is cautious optimism for the US/China trade negotiations that restarted earlier today while Trump has suggested he would push out the March 2 deadline by 60 days to give enough time to reach a new comprehensive trade deal.

Shares of Cisco and Yelp are both up premarket on earnings beats.  On deck today are KO, NVDA, AMAT, CBS, AVP, CME, and YETI.  The economic calendar focus is on the 8:30am EST numbers: PPI, Retail Sales, and Claims.

Volatility continues to remain steady as the bulls are in waiting mode over the US/China trade talks.  The thesis that upside price movement remains muted continues until the bulls find a reason to bust higher.  No Size bias again this morning as Globex Size volume was lighter than recent and mixed.


 Posted by at 6:59 am

02/13/2019 ES Trade Plan Worksheet

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Feb 132019

US and Chinese trade representatives will meet in Beijing tomorrow and Friday.  President Trump has left the door open for extending the March 2, $200B tariff deadline if trade talks progress, however he added a BUT “generally speaking. I’m not inclined to do that” and “we’re doing very well in China.”

The economic calendar focus is CPI numbers @ 8:30am EST.  Also on the calendar is Oil @ 10:30am EST and the Federal Budget Balance @ 2:00pm EST.  Cisco (CSCO) and DISH Network Corp (DISH) highlight earnings.  Also on deck are MRO, FOSL, HLT, YELP, NTAP, and MGM.

Volatility is holding steady at around 30 point ES 5-day ATR.  Expect upside price movement to be muted after yesterday’s runup.  No Size bias  as Size volume picked up during Globex but was mixed.


 Posted by at 6:14 am