Welcome to The Discovery Trading Group

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Nov 292011

We are a group of professional 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 Introduction

 Posted by at 11:24 am

10/18/2017 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 10/18/2017 ES Trade Plan Worksheet
Oct 182017

IBM beat expectations and China’s President painted a strong economic future, vowing to be a leader in clean power and bring blue skies back to the country.  He promised China would be a leading global power by 2050.  Xi Jinping also announced goals to open their markets to foreign investors and to crack down on corruption.  ES sentiment has turned short-term bullish.  Today’s economic calendar includes Building Permits and Housing Starts @ 8:30am EST, Oil @ 10:30am EST, and the Beige Book @ 2pm EST.  FOMC’s Kaplan and Dudley share a panel discussion starting @ 8am EST.  Volatility is still dismal, but the ES is showing some signs of movement pre-market.  The ES has been coiling long enough that if the bulls start to run, it could be a good run.  Size bias is long into the US session open on decent buying interest overnight.


 Posted by at 7:36 am

10/17/2017 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 10/17/2017 ES Trade Plan Worksheet
Oct 172017

Corporate earnings are in focus with MS, GS, and IBM reporting.  Also reporting are HOG, JNJ, UNH< and CSX.  No tier one data this morning, but we have Import Prices @ 8:30am EST and Capacity Utilization and Industrial Production @ 9:15am EST.  Philly Fed President Harker speaks @ 1:00pm EST.  Volatility continues to contract.  The 5-day ES ATR is a dismal 8.5 points.  The ES is coiling up and eventually will make a significant break, the big question is when?  For a break today, either the 2563s or 2550s will need to be cleared.  Size bias is long into the morning earnings reports.


 Posted by at 6:33 am