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

09/18/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 09/18/2020 ES Trade Plan Worksheet
Sep 182020

US markets remain nervous over little progress by Congress towards a fifth coronavirus relief package.

Meanwhile, the coronavirus is making a comeback in Europe.  France’s cases rose over 10K to the highest level since their lockdown in May.  London’s surge has officials considering another curb on socializing.

Global cases now exceed 30.3M and 946K deaths.  The US is at 6.675M cases and 197.6K deaths.  India has been surging and now tops 5.2M cases and 84K deaths.

Prospects for battling COVID-19 are improving.  Roche announced their Actemra drug reduces hospital patients need for ventilators by 44% which also decreases deaths.

Gaming engine developer Unity Software hopes to raise $1.3B in an IPO expected to start trading on the NYSE today for between $44 and $48 under the ticker symbol “U”.  The price gives Unity a $13.7B valuation.

While Fedex posted record profits recently, UPS is offering buyouts to their management employees to cut costs.  Atlanta based UPS has about 87K management positions.

The economic calendar focus is CB Leading Index and UoM Consumer Sentiment @ 10L00am ET.

Volatility continues to shrink but remains elevated.

Size bias is bearish into the US session open on lighter than recent GLobex volume.


 Posted by at 6:52 am

09/17/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 09/17/2020 ES Trade Plan Worksheet
Sep 172020

The Fed said they would keep interest rates low beyond 2023 but the economy also needs fiscal help from Congress shifting focus back to stimulus talks where Democrats and Republicans are at an impasse.

Mitch McConnell’s Republican controlled Senate of the 116th Congress is on track to be the least productive Congress in history.  McConnell’s desk is known as the legislative graveyard where only 158 laws have been enacted of almost 15K bills introduced since 2019.

According to Bloomberg, Oracle will get full access to TikTok’s source code to ensure that there are no back doors for the Chinese government to gather data on US users.  President Trump is not happy with the terms and with Oracle only acquiring a minority stake in TikTok.  Trump said he is not prepared to sign off on anything.

Snowflake’s (SNOW) started trading Wednesday @ $245, well above its $120 offering price.  The stock touched $319 making the company the largest US IPO this year.

The economic calendar focus is Philly Fed and Claims @ 8:30am ET.  Building Permits and Housing Starts are released @ 10:00am ET.

Volatility is decreasing but Globex price action is signaling a volatility increase.

Size bias is bearish into the US session open.


 Posted by at 7:19 am