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

11/24/2020 ES Trade Plan Worksheet

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Nov 242020

Michigan certified Biden as the winner in their state.  Within hours and without conceding or acknowledging a loss, President Trump has given the GSA the greenlight to start giving Joe Biden and his team access to national security briefings and access to transition funds.  GSA Chief Emily Murphy claims the decision was her own (not Trump’s), however Trump quickly praised her for her loyalty and tweeted that Murphy has been “harassed, threatened, and abused” for not allowing the briefings earlier.  The move is a start of transition to a Biden presidency while Trump continues to fight to hold his office.

Elon Musk is now the second richest person in the world to Amazon’s Jeff Bezos.  Musk started 2020 as number 35, but his company Tesla’s (TSLA) stock has risen over 520% so far this year.  Musk passed Bill Gates for the number 2 slot.

General Motors (GM) is withdrawing from a Trump lawsuit filed against California over their emission standards.  GM CEO Mary Barra is urging other auto makers to do the same.  Barra wrote, “We believe the ambitious electrification goals of the President-elect, California, and General Motors are aligned to address climate change by drastically reducing automobile emissions.”

McCormick & Co (MKC) is acquiring hot-sauce maker Cholula for $800M.  McCormick has been negotiating a deal with the private equity firm L Catterton since 2019.

Earnings include BBY, GPS, JWN, DLTR, HPPQ, VMW, DKS, and ANF.

Economic data includes HPIs @ 9:00am ET, Consumer Confidence and Richmond Mfg Index @ 10:00am ET.

Volatility continues to shrink was we head into Thanksgiving.

No Size bias again as Size showed little interest during Globex.


 Posted by at 7:01 am

11/23/2020 ES Trade Plan Worksheet

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Nov 232020

It’s a shortened holiday week with US Thanksgiving on Thursday and a shortened trading day on Black Friday.  Volume usually dries up during this week, but this is not a normal year with the coronavirus reducing holiday travel.

US coronavirus cases are now over 12.25M and approaching 257K deaths.  Coronavirus vaccine progress continues to be positive.  AstraZeneca announced their Covid-19 vaccine candidate is 90% effective.

Separately, the FDA gave emergency use authorization for Regeneron Pharmaceuticals’ (REGN) Covid-19 cocktail of antibody treatment of their intravenous infusion drugs casirivimab and imdevimab to people with the coronavirus over the age of 12.  This is the same cocktail given to President Trump when he was hospitalized for Covid-19.

In vaccine distribution news, the chief scientific advisor the US Operation Warp Speed said some Americans will start receiving the vaccine in mid-December.

Earnings include URBN and WMG.

The economic calendar includes Chicago Fed @ 8:30am ET and Flash PMIs @ 9:45am ET.

Volatility continues to shrink.

No Size bias as Size trading was almost non-existent during Globex.


 Posted by at 7:18 am