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

09/22/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 09/22/2020 ES Trade Plan Worksheet
Sep 222020

Fed Chair Jerome Powell and Treasury Secretary Steven Mnuchin testify about the CARES Act before the House Financial Services Committee starting @ 10:30am ET.  Powell’s opening remarks text has already been released.  In it, Powell says “Economic activity has picked up from its depressed second-quarter level… [however] both employment and overall economic activity… remain well below their pre-pandemic levels and the path ahead continues to be highly uncertain… The path forward will depend on keeping the virus under control, and on policy actions taken at all levels of government.”

The economic calendar includes Existing Home Sales and Richmond Manufacturing Index @ 10:00am ET.

Earnings include NKE, ACB, SFIX, and AZO.

Volatility remains elevated.

Size bias is short into the US session open on lighter than recent Globex volume.


 Posted by at 6:45 am

09/21/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 09/21/2020 ES Trade Plan Worksheet
Sep 212020

Renewed coronavirus fears and dim prospects for another US coronavirus relief package anytime soon are media reasons being touted for the sharp US stock Globex selloff.  The death of Supreme Court Justice Ruth Bader Ginsburg complicates another stimulus as US lawmakers prepare for a historic fight over a replacement into the 2020, November 3 presidential election.

This year’s darling tech stocks are leading the US market selloffs.  Both the S&P 500 and Nasdaq have declined for 3 straight weeks.

Global coronavirus cases now surpass 31M and 961K deaths with a renewed surge in European cases.  The US leads with 6.8M cases and 199.5K deaths.  India and Brazil are close behind with 5.5M and 4.5M cases respectively.

President Trump gave his blessing to a deal for Oracle and WalMart to purchase 20% of TikTok from ByteDance one day before the Commerce Department was to block new downloads of the app.  The deal creates a US based company TikTok Global with plans to take the company public on a US stock exchange.  The deal also delays the banning of TikTok by one week.

In a related situation, Tencent Holdings, the Chinese owner of the popular WeChat app can remain operating in the US.  A federal judge issued an injunction against President Trump’s executive order banning the app from use in the US.

Tesla is expected to announce on Tuesday details for a new battery they will be producing that will have a larger form factor and a tables design that will lower battery cost per kWh.  Expectations are that the new battery technology could last decades and withstand weather and terrain.

The economic calendar is bare.  Fed speakers include Chair Powell @ 10:00am ET and Governor Brainard @ 12:00pm ET.

Volatility is rising again as the ES moves down.  Volatility remains elevated.

Size bias is short into the US session open.


 Posted by at 6:30 am