Welcome to The Discovery Trading Group

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Nov 292011
 

We are a group of professional traders and principals of a quantitative research firm which develops strategy and periodicity diverse risk modeling tools suited to larger, longer time horizon portfolios. Our own internal process involves using this webspace as a collective resource for sharing both discretionary information during intraday sessions and as a sort of virtual think tank for our ongoing quant research. A big part of that ongoing 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, a dynamically adaptive, risk 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 other 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 as well as serve to cement the ones already implemented. That we can also give back to the trading brotherhood by way of helping like minded aspiring traders in the process makes 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 we share here, follow this link:

Methodology Introduction

 Posted by at 11:24 am

07/26/2017 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 07/26/2017 ES Trade Plan Worksheet
Jul 262017
 

It’s a Fed day with the FOMC announcement @ 2:00pm EST.  Expectations are for no rate hike and focus will be on wording about the future and how the Fed plans to reduce their trillion-dollar book.  Economic data includes Home Sales @ 10:00am EST and Oil inventories @ 10:30am EST which will get extra attention today as ADP’s numbers showed an unexpected 10M draw sending crude higher overnight.  Corporate earnings continue look good.  We have BA, FB, GILD, F, KO, VRTX, and WFM on deck.  Today’s volatility is a hard call.  With the looming FOMC announcement, will the bulls anticipate a benign announcement and take the ES higher or will they wait for 2pm EST?  I think they’ll most likely hang out around the 2478.75 all-time high but wouldn’t be surprised if directional movement develops before 2pm EST.  There’s also a good chance the announcement will be a dud and we don’t get much movement at all today.  No Size bias this morning as overnight volume was mixed.

 

 Posted by at 6:42 am

07/25/2017 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 07/25/2017 ES Trade Plan Worksheet
Jul 252017
 

Alphabet (a.k.a Google) beat expectations but hinted profit margins could decrease in the future because of rising costs.  Shares of GOOGL are fell 2.5% pre-market.  For the ES, the Asian session was mixed and the bulls are starting to show themselves into the US session.  The ES remains pinned under its 2475.25 all-time high, but is certainly within range to probe today.  For economic data, we have HPI @ 9:00am EST and Consumer Confidence @ 10:00am EST.  However, trading today will be based on speculation on the FOMC minutes tomorrow.  After 3 rate rises, it’s unlikely the FOMC will raise rates again.  Thus, the bulls may take advantage of the generally good corporate earnings.  Earnings today include GM, MCD, AMD, KMB, CMG, JBLU, T, MMM, CAT, X, AMGN, BIIB, ESRX, and LLY.  Volatility should remain subdued unless the bulls clear the 2475s and then 2481s.  No Size bias this morning as overnight volume was mixed.

 

 Posted by at 6:43 am