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

12/03/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 12/03/2020 ES Trade Plan Worksheet
Dec 032020

US Covid-19 deaths hit 2700 on Wednesday, the deadliest day yet.  US hospitalizations topped 100K for the first time.  CDC head Dr. Robert Redfield warned “December and January and February are going to be rough times… I actually believe they’re going to be the most difficult time in the public health history of this nation.”

The CDC also warned that total US deaths could reach 450K by February unless Americans take greater precautions.  Current US Covid-19 deaths surpass 273.8K and nearly 13.93M cases.

US stocks closed cautiously higher on Wednesday after Democrats Nancy Pelosi and Chuck Schumer called for another round of stimulus talks to begin.  Fed Chair Jerome Powell and Treasury Secretary Steven Mnuchin both urged Congress to create and pass another Covid-19 relief package.

Earnings include MRVL, DOCU, KR, DG, CLDR, ULTA, MIK, SIG, ZUO, and LE.

The economic calendar includes Claims @ 8:30am ET, Final Services PMI @ 9:45am ET, and ISM Services PMI @ 10:00am ET.

Volatility is starting to shrink as the S&P 500 closed at another record high on Wednesday.  Progress on the Covid-19 stimulus bill should be the primary short-term driver for upside volatility expansion. Volatility increases are more likely to come from the downside.

No Size bias as Globex Size volume was too light to be meaningful.


 Posted by at 6:31 am

12/02/2020 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 12/02/2020 ES Trade Plan Worksheet
Dec 022020

Both the S&P 500 and Nasdaq closed at new record highs on Tuesday after hitting new intraday all-time highs.

The Pfizer/BioNTech Covid-19 vaccine was approved for emergency use in the UK, the first Covid-19 vaccine approval by a western country.  The vaccine will be made available across the UK starting next week.

Asian stocks closed mixed after President-elect Joe Biden said that he would not immediately ease Trump’s tariffs on China.

Salesforce.com (CRM) is down nearly 5% premarket after announcing they will be acquiring the messaging company Slack Technologies (WORK) for $26.78 in cash and 0.0776 Salesforce shares per Slack share.  The deal more than a 50% premium over Slacks stock price last week.

Earnings include SNOW, SZ, PVH, SPLK, CRWD, OKTA, and FIVE.

The economic calendar focus is ADP @ 8:15am ET, Oil @ 10:30am ET, and the Fed Beige Book @ 2:00pm ET.  Fed Chair Jerome Powell continues his congressional testimony about the CARES Act @ 10:00am ET and the Fed’s Williams talks about the economic impacts of Covid-19 @ 1:00pm ET.

Volatility ticked up yesterday and is more likely to increase to the downside than the upside.

Size bias is long into the US session open on light Globex volume.


 Posted by at 7:49 am