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

03/19/2019 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 03/19/2019 ES Trade Plan Worksheet
Mar 192019

The 2-day Federal Reserve policy meeting begins today.  As most economists agree that the US is heading towards a few years of recession (contrary to the White House’s stance that their tax cuts will fuel the economy), the Fed will most likely continue their wait and see approach.  FedWatch predicts a 98.7% probability that Fed will no raise rates tomorrow.

Tesla CEO Elon Musk is under fire from the SEC again over his “reckless” tweets.  Under a court order, Musk is required to have his tweets pre-approved by a securities council, something Musk has ignored.  Boeing (BA) remains under pressure, but not enough to keep the DOW down yesterday.  The earnings season is winding down.  On deck today are FDX, TME, and DSW.

The economic calendar is very light: Factory Orders @ 10:00am EST.  Volatility should be like yesterday’s as the markets enter Fed wait mode.  The wildcard remains new US/China trade war news.  No Size bias as Globex volume was both light and mixed.


 Posted by at 7:07 am

03/18/2019 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 03/18/2019 ES Trade Plan Worksheet
Mar 182019

It appears unlikely that a US/China summit between Trump and Xi Jinping will happen in April according to sources of the South China Morning Post.  One source said the summit might happen in June.  Preparing the text for a US/China trade agreement is taking more time than Trump had anticipated.

Boeing remains under scrutiny as flight recorder data shows the 737 Max 8 crashes in Indonesia and Ethiopia have “clear similarities.”  Boeing is preparing a software update to better handle “erroneous sensor inputs” which appear to be involved in the chain of events leading into both crashes.

In merger news, Fidelity National (FIS) has agreed to acquire UK-based payment processor Worldpay (WP) for stock and cash valued around $43B, a greater than 13.5% premium to Worldpay’s Friday closing price.  The earnings calendar is light: TLRY, LL, SCS, OSTK.

The economic calendar is also very light: NAHB Home Builders Index @ 10:00am EST.  Volatility for today is a tough call given it’s a low news Monday with the ES working through significant resistance.  We could see a significant move up, or a significant move down, or the ES could settle in and do not much of anything…  Friday’s 2836.50 high and 2817.25 low are the key areas for the ES to clear if there’s to be significant movement today.  No Size bias as Size wasn’t interested in trading overnight.


 Posted by at 6:23 am