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

08/02/2021 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 08/02/2021 ES Trade Plan Worksheet
Aug 022021

Amazon’s (AMZN) revenue miss and the GDP rising less than expected pressured stocks on Friday.  Corporate earnings remain in focus and sentiment got a boost as prospects for a $550B infrastructure package is looking more likely to pass through the Senate this week.

Square (SQ) is to acquire Afterpay, an Australia based buy-now, pay-later company.  The deal would be Square’s largest acquisition.  Square says the buy-now, pay-later business is an alternative to consumer credit, and it appeals to younger consumers.  Square shares are down 3.18% after the announcement.

Zoom Video Communications (ZM) reached a preliminary settlement for a $85 million data privacy lawsuit.  The lawsuit was filed in April 2020 and alleged Zoom shared personal data with Facebook (FB), Microsoft’s (MSFT) LinkedIn, and Google (GOOGL).  The lawsuit also alleged Zoom allowed Zoombombing, a way for hackers to interrupt Zoom meetings with pornography, vulgar language, or other content.  The settlement would provide Zoom users with 15% refunds on their subscriptions.

Earnings include NXPI, SPG, RACE, TTWO, and SEDG.

The economic calendar includes Markit Mfg PMI @ 9:45am ET, ISM Mfg Index and Construction Spending @ 10:00am ET.

Volatility remains steady with the ES 5-day average range around 40 points.

No Size bias a Size did not participate in the Globex bullish rally.


 Posted by at 6:47 am

07/30/2021 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 07/30/2021 ES Trade Plan Worksheet
Jul 302021

The Delta coronavirus variant continues to surge and fear it will hinder economic growth the second half of 2021 is creeping into the markets.  The CDC suggested that the Delta variant causes more severe illness than the original coronavirus and spreads as easy as chickenpox.  The CDC will publish data today that supports their guidance change that fully vaccinated people should wear masks indoor.

Texas Republican Dan Crenshaw went on Fox news Thursday and said CDC data is from a non-reviewed study from India.  He told Fox viewers the CDC and FDA have conflicting messages and he trusts the FDA.  Saying mask wearing is a Democrat tactic to scare people, Crenshaw implored Fox viewers to resist wearing masks.

The US GDP grew at an annual rate of 6.5%, well below analyst expectations of 8.4% and a sign the Fed will continue supporting the economy.

Amazon (AMZN) is down over 6% premarket after a rare revenue miss for the first quarter after founder Jeff Bezos stepped down as CEO.  Amazon beat earnings, up 46% over a year ago, but revenue came in at $113.1 billion versus $115.2 billion expected.  Revenue was up 27% year over year.

Robinhood (HOOD) finished its first day of trading down 8% and continues to trade lower premarket.  The company raised about $2.1 billion in it’s IPO, selling 55 million shares @ $38.

Earnings include PG, XOM, CVX, ABBV, CAT and CL.

The economic calendar focus is Core PCE @ 8:00am ET, Chicago PMI @ 9:45am ET, and Consumer Sentiment @ 10:00am ET.  The calendar also includes Employment Cost Index, Personal Income & Outlays @ 8:30am ET.

Volatility remains steady as the S&P 500 continues to work near its all-time highs.

Size bias is short into the US session open on the heaviest Globex volume we’ve seen in a long while.


 Posted by at 6:25 am