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

09/20/2018 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 09/20/2018 ES Trade Plan Worksheet
Sep 202018

Oil prices are up for the 3rd session in a row after the Oil Inventories report yesterday revealed US levels had fallen to their lowest in 3.5 years.  WTI is over $71/barrel.  Amazon announced plans to open as many as 3,000 cashier-less AmazonGo brick and mortar stores by 2021.  Prototype stores in Seattle and Chicago are being tweaked, but Bezos sees enough success to move forward.  Meanwhile, to keep up with the Musks, Bezos said he would invest over $1B Blue Origin’s New Glenn rocket program which will fly people into space this year.  On the trade war front, Alibaba CEO Jack Ma retracted his 2017 promise to create 1 million new jobs in the US;  “This promise was on the basis of friendly China-US cooperation and reasonable bilateral trade relations, but the current situation has already destroyed that basis”.  The economic calendar focus is Philly Fed and Claims @ 8:30am EST and Existing Home Sales @ 10:00am EST.  Earnings include MU and DRI.  Volatility continues to contract as the ES remains pinned under its back-adjusted 2922.50 all-time high.  Assume upward movement will be grinding.  No Size bias as Size has taken little interest in trading overnight.


 Posted by at 6:29 am

09/19/2018 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 09/19/2018 ES Trade Plan Worksheet
Sep 192018

China’s retaliation of 5% tariff on $60B of US goods after Trump’s 10% tariff on $200B of Chinese goods was less than expectations and thus became bullish for US stocks.   Is this a sign towards resolution?  Not sure, but the markets seem to be taking it as a sign.  Resolution in the short-term (i.e. before the November US mid-term elections) would most likely be very bullish for US stocks.  The economic calendar focus is Housing Starts @ 10:00am EST and Oil @ 10:30am EST.  ECB’s Draghi has a talk starting @ 9:00am EST although it’s been a long while since his comments have affected the US markets.  Only company of note with earnings is RHT.  Volatility increased yesterday and now the ES is once again pinned under its back-adjusted all-time high.  Expect upside volatility to be muted while the market wait on additional US/China or US/Canada trade war information.  No Size bias as overnight volume was too light.


 Posted by at 7:03 am