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daytraderI have really wanted to write an article on why I hate day-trading for some time now…because I actually do HATE it…Day-trading is something that everyone knows about; you could walk up to any stranger and say “what do you think about day-trading?”, and they would probably say something like “risky, but it can make you rich really fast”. Day-trading is one of the main ideas that lures people into the trading world; they think they will make some fast money and live the “dream” if they just learn how to “day-trade”. However, once they try it, most people quickly realize that it’s time intensive, stressful, and extremely difficult to make consistent money at.

If you get hooked on day-trading you are going to enter into a game of ‘quantity over quality’ of trades, and that is not what we believe in here at Learn To Trade The Market.  Our goal is to help traders  ‘preserve capital’ and wait patiently for only the ‘high probability trades’. Hopefully this article gives you some insight into why day trading is typically a highway to disaster for most traders.

I hate the façade of the stereotypical “day-trader”…

There seems to be an impression among the general public that if you’re a financial market speculator of any type you’re a “day-trader” sitting at home in front of multiple monitors making tons of frantic keystrokes and phone calls all day. Indeed, it seems more prestigious for us to tell our friends and acquaintances that we are “day-traders” during a lunch or dinner conversation…because when you tell someone you’re a day-trader they immediately get a certain image in their head. If you say “I’m a daily chart swing-trader and I trade 4 to 10 times per month”….well that just sounds a lot less glamorous doesn’t it?

This Illusion of the “day-trader” is something that appeals to many people simply because they want to say they are “day-traders”…there’s a certain perception of being some young and rich “day-trader” making millions and having a Ferrari…it ain’t reality though…

The reality of a day-trader is a guy who got 2 hours of sleep last night because he was trying to trade the overnight session, now he’s up at 6am trying to day-trade the next session. Many traders get sucked into trying to become a rich day-trader largely because that’s what they think is socially acceptable or “cool”,  and it turns into them being glued to the charts every chance they get and probably not making much money (if any). This is not a healthy way to trade and it’s definitely not a healthy way to learn how to trade.

Top down approach

As a trading educator, it makes me HATE day-trading even more when I think about all the trading websites out there promoting it and how a lot of them are geared towards beginner traders, not to mention how heavily day-trading and scalping are discussed in almost every public trading discussion forum on the internet. Day-trading is something that should only be attempted by a very experienced trader, and probably should just not be attempted at all.

You need to think of trading like building a house; first you need a foundation to build the house on, then as the house progresses you get down to finer and finer details until finally you are discussing how to decorate the interior and what type of TV to buy. As a trader, you NEED to understand how the higher time frame charts work and higher time frame price dynamics before you attempt trading the lower time frames. Trading should ALWAYS be taught and learned in a top-down technical approach, so that you understand what the higher time frames are doing before you try lower time frame trading or day-trading. This is how I teach my students in my trading courses and it’s how I have personally traded for over a decade..

Most Brokers CA$H in on day-traders (not all, but most)

Another reason why I hate day-trading is that there’s definitely a financial incentive for brokers to get people to trade more frequently. It’s very simple, more trades equals more money from spreads or commissions and that equals more money for the broker. So, there’s an underlying bias by many brokers and the greater Forex industry to get traders hooked on trading as frequently as possible. Brokers who have wider spreads make more money off you every time you trade, so they want you to trade. Thus…day-traders make a lot of money for many brokers; this is why you aren’t going to see any information about the perils of day-trading on most brokers’ websites.

It’s worth noting that not all brokers do this; some brokers have very tight spreads and don’t emphasize day-trading, and this is fairer on the trader, but most simply don’t. A Forex broker is in a position of “authority” to the unsuspecting newbie retail trader who assumes the broker well always do what’s in the best interest of their client. The point is this; be sure you choose your broker wisely.

I’ve been trading for over 10 years and I still do not “day-trade”…that should tell you something right there. Again…it comes back to preserving your own capital…when you trade more frequently you give more money to your broker in spreads or commissions, leaving you with less money to trade with when you get high-probability signals in the market.

Stop-hunters love day-traders

Day traders naturally have stop losses closer to the market price since they are typically trading intra-day charts and trying to get quick gains with tight stops. The “big boys” and institutional traders love the average retail day-trader because they give them plenty of stops to “hunt”. Being a day trader and entering a lot of trades each week means it’s a lot harder to have a high winning percentage, largely because you get stopped out so much. Institutional traders have access to information on order flow and where stops are placed; it’s not only brokers who go “stop hunting” but the bigger institutional traders who can “sniff out” where the smaller intra-day traders are placing their stops. Have you ever noticed how if you try to trade intra-day the market tends to hit your stop and then reverse back in the direction of your initial position? The more day-trades you enter the greater risk you run of getting “stop-hunted” by the big boys.

Example Of Stop Hunting In Action

In the chart example below, we are looking at a 15minute USDJPY chart from earlier this week. Now, had you been trying to day-trade this 15 minute chart you probably would have talked yourself into trading all three of the pin bar setups below…

failed signals

Example of How To Avoid Stop-Hunting

Now take a look at the daily USDJPY chart below…none of those 15 minute failed pin bar setups are even visible…by focusing on the daily chart you give the “stop-hunters” less prey, and you save yourself money, time and stress:

failed signals2

Market Noise: High-frequency and quant algorithm traders hurt retail day-traders

With the advent of high-frequency and quantitative algorithmic trading, we have intra-day charts that are full of false-signals and what I like to call “market noise”. A retail day-trader in today’s markets has a much tougher time trying to turn a profit than they did even about 10 years ago before all this high-frequency computer trading was so prevalent.  These high-frequency traders have what is essentially an “unfair” edge because they see the data that we see but a lot sooner. (you can read an article later about high frequency trading here). This type of trading has really changed the “nature” of intra-day charts from what they used to be, making them more erratic and less predictable, which obviously makes it a lot harder for the average retail day-trader to read the chart…

Note all the “noise” on this chart…it’s a 5 minute chart and is only showing about a 15 pip range…this is a very messy and difficult chart to try and trade…notice all the failed signals and “shake outs” that occurred…this type of trading will chop your account to pieces very fast

5min

This is another reason I really hate day-trading; who wants to try to sift through a sea of false-signals and market noise when you can so easily “smooth” it all out by looking at the higher time frame charts? As some of you know, I only teach and trade on time frames above the 1 hour, and even the 1 hour is not a time frame I personally trade very often. The 4 hour and daily time frames are my favorite, and I really consider anything below the 1 hour to be trading account “suicide”.

Filter out the “B.S.”

Day-trading ingrains and reinforces the “more is better” mindset which is basically gambling, instead of the “less is more” approach of swing trading the higher time frames. As we have seen, today’s retail day-trader is up against some pretty stiff competition in the form of super computers and algorithms that are programmed by math “wizards”. Why waste your time and fry your nerves trying to compete against such players with this type of unfair advantage when there is a much easier and more lucrative way to trade?

This is why I trade the 4 hour and daily charts; they filter out all the “B.S.” that happens on the small time frames as a result of all these super-computer-math-wiz-algorithms. I guess if I really had to explain the difference between day-trading and higher time frame swing trading it would be this; work smarter, not harder. Trading on the higher time frames and ignoring all the chop and “B.S” that day-traders try to deal with is really how you trade smarter. If you want more training and instruction on how to trade “smarter” on the higher time frames, checkout my Forex trading course and members community for more info.

Good trading, Nial Fuller

nialfuller

About Nial Fuller

is a Professional Trader & Author who is considered ‘The Authority’ on Price Action Trading. He has a monthly readership of 250,000+ traders and has taught 15,000+ students since 2008.
Checkout Nial’s Professional Forex Course here.

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140 Comments

  1. Khyati verdhan says:

    Very very thank you sir
    You are the first person who tells the truth of market

  2. Taryn says:

    I’m glad I came across this article, as I was going to sign up at a day-trading company. Trading is something I aspire to do – could you tell me what the difference is between day trading & what exactly it is that YOU do? I’m so overwhelmed with all of the information my brain is taking in with regards to trading, it’s about to explode! Lol.

    If I want to trade the way you do, are there any firms available to help me out with funding? I’m an MBA student & not working at the moment. I’m aware that commission is involved, obviously.

    Your advice & guidance would be most appreciated. :-)

  3. ogiya says:

    No words to Thank you , your course is really helping me. I repeat thank you once more.

  4. Jonathan Egesie says:

    I tarted reading Mr. Fullers articles 3 weeks ago and to be honest I adopted his trading trading style. In two weeks consecutively, I have been in profit something that has not happened since my 8 years of being a day trader.

  5. Clinton says:

    Very good article … as a newbie I have learnt that most if the money I made was from the daily chart … but have fallen prey to doing multiple trades a day and lost all of the gains. Thanks to LTTTM this has all changed and I am a converted swing trader now. Great stuff Nial

  6. Helen says:

    You are spot on Nial
    That’s my goal to run million miles away from those pathetic low time frames, I used to make lots of bucks on them and losing it all if not more! Extremely stressful.
    Thank you for making it a BIG point and keep up the good work and being honest.
    Helen

  7. zephania says:

    Thanks Nail for the timely advice. I use the higher time frames, the major
    problem I have is on the entries.

  8. Sthembiso says:

    True, very true Nial. I knew that the ones who benefit from day traders will disagree with this truth.

  9. Sympans says:

    “The reality of a day-trader is a guy who got 2 hours of sleep last night because he was trying to trade the overnight session, now he’s up at 6am trying to day-trade the next session”.

    Nial, you live “Down Under” and it can look like this from your perspective. Maybe you could see it in an other way if you would live in Europe like me. Just imagine: London Open = 10.00 AM. NY Open = 4.00 PM. You can day-trade in a usuall business hours.

    I even don’t know exactly when NY closes: maybe at 11 PM, maybe at 12 PM. I always sleep at his time. I can enter a D1 trade only a couple of hours after the new candle started.

    Of course, you may be right that trading on a daily chart is better than day-trading. But please remember: 6 + 3 = 9, but so does 5 + 4. Or 2 +7. Don’t hate other people’s way of thinking. Respect it.

    1. Nial Fuller says:

      I respect peoples opinions, I just don’t have to agree with them. Day trading in the traditional sense has a very high failure rate and leads to account churning.
      I want my students and followers to understand the realities and that is what I write about.

      1. SHUBAM BAJPAI says:

        Nial is 100% correct. He repects all other opinions & So do i. He & his followers are price action traders, so he is guiding them to trade on H4 & D1. Which are best timeframe for price action trading with his setups, ofcourse there are few traders making money trading lower time frame charts but most of them are using other strategy than price action. Wake up. This website is about price action strategies

        1. SHUBAM BAJPAI says:

          and yeah also keep in mind that those strategies are too much complicated. And nial’s price action strategies are very very simple. I am his official student thats why i know. End of day higher time frames trading is far better then day- trading sitting infront of your computer and wasting whole life & time

  10. Justin says:

    Day Trading is a mirage for people who don’t have a real job. It’s a perfect place where the money transfers silently from poor people to rich brokers.

  11. Alex McCullie says:

    Despite even ‘knowing these things’ it’s great you wrote an article like to hammer home the point the benefits of longer time-frames.Again, another a well written, telling article. Thanks again. Just an aside it was also good to have some charts to practice ‘what why I have done’ Alex

  12. EMMAH DANIELS says:

    Being in the market since 2007 and believe me lower time frames i.e H1 -M1 have wiped my account more than 4 times. keep off.

    EMMAH DANIELS
    NIGERIA.

  13. rexwinthrop says:

    Day trading is a farce

  14. Justin says:

    i can’t agree with you more. Most of day traders do not make more than 50K a year. Very few people make 100k a year. After paying all trading fees and spreads, people won’t make much. Even if they do. The short term capital gain tax will take big chunk out of it. In my opinion, people do day trade cause they don’t have a real job. I do long term buy and hold and sell covered calls/puts. That gives me very consistent performance with very little work while i can still focus on my profession as an endodontist.

  15. David says:

    Nial, I can tell you are versed in the fx market and a very good businessman as well. After reading this article and comments I wanted to share my thoughts on a few things you wrote. First and foremost, intraday traders( good ones) do make money on a consistent basis and most do not only trade one time frame. Specializing is also a key to one’s success in this business; being able to spot a probable trade in any time frame is just as innate a quality that makes one profitable in predominantly one – sometimes you can’t teach this.

    Volatility or noise, whatever name you use, it is something that is needed and is capitalized on. Here’s the reality of all that noise, it actually makes the trending price action. It’s all transpires into the different time frames and makes the market tradeable.

    Ultimately, I don’t disagree that a beginner isn’t going to have a difficult road trading. People should understand this…the 98 percent of traders that don’t make money in the markets, didn’t make money in any of the time frames.

    1. Nial Fuller says:

      David, all good comments. To be frank with you, most day traders or high frequency traders lose the average of the spread on every trade, that is usually 1.5 to 2 pips per trade round trip. The more you trade the more you lose, all brokers know this and that is what brokers rely on. I have plenty of contacts inside the industry that provide me with the statistics and I can tell you that 99% + of all clients who attempt day trading or high frequency trading lose alot of money. Those that tend to make money are position traders and those who look to hold trades over longer hold periods (multiple days, weeks or months). I agree some traders with skill and experience can make money day trading, but it’s the hardest way to trade and the odds are stacked against you because of the price spread on each transaction.

  16. Daniel says:

    It always makes me laugh when I meet people who are just getting into trading and they boldly state that you can make lots of money daytrading for just an hour or so per day. Then they give me examples of people who are selling courses stating that they make 1000s of pips per week etc. These newbies dont have any chance and are just getting taken to the cleaners.

    Knowing what I know now about higher timeframes I would never ever go onto anything lower than a 4HR chart. In fact on MT5 I have D1/H12/H8/H6/H4 and have removed the rest from sight.

    This is all I need to give me a decent % per year and am already up 37% of my account since the start of the year.

    Higher Time Frame trading rocks!!!

  17. Zain says:

    DAY trading is very very risky specially for newbies ,,, Because they do not know market flow … Market is very un-predictable no body know when market go opposite … So i personally suggest every newbie practice on weekly or 2 3 days trading Chart. Which make you a real and long term trader… Thanks

  18. Ethanmichel says:

    Good one, it will be more informative for traders…Thank u.

  19. Wibowo says:

    Intraday Trading is basically a High Cost & Effort Trading Activity to make money in Forex Market. And in any period of time the End Result is not always better than Daily Trading. I agree with this Good Article. Very Good NIAL ….

  20. Marcin says:

    There is no such thing as stop hunting in the market. It is normal market behaviour of seaking liquidity.
    It safe to trade with higher timeframe perspective in mind while 15 or 30 min chart is used, where you can spot areas of high liquidity and market reaction.

    1. Nial Fuller says:

      Marcin. I am sorry but I strongly disagree with you…. Stop hunting or stop running is a very real concept and happens every day in the markets. I do agree in part that market looks for ‘liquidity’as you have suggested, but I don’t believe this is the same concept as stop hunting. They are 2 unique market phenomena.

      1. Dana says:

        definitely stop hunting in equities-i was trading a stock that hadnt moved 10 cents in 30 minutes-short 13.01-stop-13.11-took 34 seconds for my stop to be hit and 1 minute later stock was at 12.91-definitely algo stop hunter got nice short in-equity now at 12.71 2 hrs later with nevra retrace to 13.10

  21. nihal bhat says:

    day trading is okay for 15min charts and above. under 15min and you have to keep checking the screen frequently resulting in addiction and emotions in trades

  22. oyedeji muyiwa says:

    Nice one thumbs up for you.

  23. Tommy says:

    Great article again and again , thank you for it :)

  24. Javier says:

    Excellent lesson Nial !!!!
    Very clever and smart concepts what you exhibit
    Best regards
    Javier

    From Argentina

  25. FX50pips says:

    nice article Nial, in fact this is actually how i do my trading is very easy and simple to trade this way yet come out with a huge profit. so why stress yourself with baseless effort to make money quick? patients is the only ingredient that you need to do this…. believe me you can be extremely successful trading this simple way….

  26. Olatunde ademola says:

    pls continue the good work

  27. Andrew says:

    I don’t see the failed pinbars on the USDJPY – all three gave great 38-50% entries and 2:1 RR or better.

  28. Taffy says:

    Great article Nial, you can safely rate this as one of your best. I agree with you especially on the point that there are “stop hunters” out there and there is no point competing with them when you can lessen their impact on your account.

    Cheers,

  29. semajio says:

    Nail, you have nailed it again. The more traders that heed these words the better.

  30. mbongeni says:

    Thanks Nial for your vast knowledge about trading Forex,soon I will be enroling on Foex Trading course.

  31. Eve says:

    Yeah I am already find out that I am really tired of day trading, trading daily chart is more less calm and stresles but you also need a time and nerves to play out to your way.

    Nial, how would you compare trading (day, swing, momentum,…)with performance of some professional sportsman? They have ages where they are in very good performance and than after some time they can`t compete any more?

  32. s.bala says:

    Thanks Nial, You are THE MAN.
    Great guidance.

  33. Czarek says:

    Daytrading is crazy. I tried some, didn’t demolish my account (really had good periods making some money) but realized that this is not trading at all! This is time consuming, addictive and mentally exhausting. Even when you make money your broker make even more, and it’s so absorbing that one moment you hate this. Stops are hit so often that you are on emotional rollercoaster.

    Absolutely agree with Nial. One can daytrade from time to time for fun, but as a trading method it’s not best idea. Instead I like this idea of minimalistic, “purist” trading, and I hope to become succesful trader eventually. Or better to say “risk manager”. Idea that trading can be peaceful and that “less can be more” really opened my eyes. I feel that mystery of good trading lies in psychology and emotional aspects of human nature. Thanks to Nail for conducting us this way. Hope this is right path.

  34. josem says:

    I would like to analyze this question from the standpoint of time / reward only and get some more concrete parameters. if you are a swing trader you will spend an average of 1 hour per day to analyze 5 times the 4H chart, and may cover some 10 markets as I do. day traders spend at least 8 hours a day glued to the screen, if not 12 or more hours following at most two or three markets. then a day trader will spend at least 8x longer , covering about 1/3 of markets than a swing trader. even if he is a successful day trader, I doubt that the results are proportional to the time he spends and lower quality of life !!!

  35. Ugochukwu says:

    I,m richly inspired by your honest experiences which you share with us all the times.God will never let you down

  36. Tim says:

    For various reasons, the shorter the time frames the lower the signal to noise ratio. This makes setups more difficult to spot and less reliable. Providing there is reasonable liquidity (currency majors even on 5 minute charts normally provide this), you will still get strong and valid set ups on short time frames. The problem is that you may have to wait hours and sometimes even days for them to occur and that is psychologically very difficult to handle. Most short term traders become impatient and finish up overtrading. A few, people with the necessary skill and discipline are able to consistently trade these timeframes but in my experience it is the most difficult as well as the most physically and mentally exhausting form of trading that you can undertake.

    An hour or two of scalping, once or twice a week however is terrific practice and may help to keep you sharp and on your trading toes.

  37. Dennis from Orlando says:

    Trying to call the next move on a 5 min chart is like in a sporting event trying to predict who will win the first 5 min of the 3rd quarter. You are just guessing. Best to stick with daily charts and only trade reversals and breakouts

  38. Matthew Godfrey says:

    I thoroughly agree Nial. I think people day trade to satisfy an emptiness that doesn’t have much to do with making money. As a person with a tendency towards addiction I can see the appeal of day trading and strangely I can see how it could even be oddly comforting to loose money. Your trading paradigm weeds out many of the features that make trading something other than a money trading venture (e.g. it’s not fast, you don’t watch the screen and experience the highs and lows etc). I’ve been a member for about 3 months and I teade pin bars (at significant levels etc) on four of the majors on the day chart on a demo account. I’ll be going live in the coming months.

  39. Tilip Kumar says:

    Well said

  40. SLIVESTER says:

    thanks a lot nial…trading in high time frame is my chances to change my future…thanks for the best article…

  41. Tim A says:

    I wish Nial could’ve shown a normal Daily chart instead of a perfect one without fakeouts. If what he said is true he doesn’t need to exaggerate. I do agree that the lower timeframes are a heck of a lot more noisy, but Daily charts also have their false stopouts. Many of the Fakeys and Pin bars on the Daily took someone out before reversing, lets not kid ourselves that Dailies are free from this. Otherwise newbies are being mislead just the same.

    1. Nial Fuller says:

      Tim
      I will add more examples to suggest daily charts experience ‘less stop hunts’ than intraday charts. I agree, no chart or method will remove the chance of ‘stop hunting’ etc.

  42. Jeriah says:

    I love the explanation on stop hunting. Thanks!

  43. thompson says:

    this is true

  44. BSmart says:

    Absolutely. Thank you for this article.

  45. RD says:

    Super article, Nial. I thought I would jump into the mix on this one. I doubled my Scottrade stock account in 2007 trading off the daily charts ( bull market ). I retired from my plastering career and day traded the stock and futures markets in 2008 using 5 minute charts. What an emotional and wild ride that was. By year’s end I literally fought to break even in one of the most unruly bear markets in history( moral victory, but not so great for paying the bills ). I realized that my temperment was not suited for day trading at all. One’s emotional control and discipline has got to become so focused– almost robotic by nature in order to succeed. I will admit, there are professionals who make an excellent living at it, but they are indeed few and far between. Amen to daily charts and trading relatively infrequently and not being glued to the computer monitor . . .

    Cheers,
    RD

  46. Amitabh says:

    Depends on how you define “day trading”. I do it, but I usually look for 1 trade a day, and don’t necessarily close out by end of day. I use a top-down approach like you stated–Daily chart is key.

    At the same time, I wouldn’t write off the possibility of someone who trades many times per day off the 15 min chart or whatever; I still think you need the top-down approach to do so–to more accurately identify the trend.

  47. Yusuf Hammed says:

    Great Ideal

  48. water says:

    Superb revelation .No body else other than One and only one Nial fuller will do it .I was trapped by the magic of day trading.Today onwards I quit day trading once and for ever.

  49. vip says:

    i love trading the 4 hour charts to XD.

  50. Graham says:

    Nial, I am a 3 year old trader. I have 3 blown accounts in my past. But this last one, 3 months old now is growing nicely. And the only reason it is grow is that I stopped using a live data feed. I use ninjatrader platform that gives me end of day data only. My trading plan I have adopted from your videos you make available for free on youtube. This article highlights exactly why and how my last 3 accounts got blown, they NEVER GOT IN THE MONEY even. hahaha, day trading its a joke. I will wait till the end of day to see what price did that day. And I am often in trades that last several days , especially lately.
    Cheers.

  51. dustin says:

    I agree with u 50%! as i started trading 4 years ago i was Day trader for 2 years i was break even most of the time, then i started to trade the bigger time frames, daily charts i make using trading on the daily average. Etween 400 and 1200 pips a month.but there is a problem on the day trading the STOP LOSS is really big number 2 u neex to have big capital to make life from it …… anothere reason if the market is not trending for long time could expand for several months u cant trade well …. Now about trading as day trader in m opinion every one can make money on it under some conditions : 1 – follow the bigger time frames
    2- once u hit the first target which is mostof the time not more than 30 pips take ur profit

  52. Jose says:

    Day-trading CAN be very profitable if you can stay glued to your charts 24/7. I have done it in the past BUT there’s a price to pay in terms of the stress involved. Also, if you make a mistake it can be a slippery road to a world of pain… If you want a normal life without stress stick to swing trading the H4 or daily charts per Nial’s advice.

  53. Nuno Barbosa says:

    Thanks Nial, once again.
    Great article.
    I loved when you wrote: “Have you ever noticed how if you try to trade intra-day the market tends to hit your stop and then reverse back in the direction of your initial position?”
    This happened to me most of the time in day trading.
    Trading higher time frame charts and looking for price action is what suits me best.
    Thanks for everything you are doing.
    Keep the good work.
    Regards from Portugal.

  54. James Mboho says:

    personally, i have raised a $10 account to $213 day-trading 15 min time frame for three weeks though it was very very stressful. That was at my early stage of my trading carrier. it was fund. Base on this achievement, i was carried away and after sometime i fail to follow my trading rules and strategy. The moment i started neglecting and disobeying my trading rules, i was no longer profitable trading smaller time frame. i say this because smaller time frame is very profitable if a well thought out strategy/ trading rules is strictly followed. But the disadvantages are that, it is very stressful, high emotion is involve and as a matter of fact once health is at stake. I even know of a professional who trades one minute time frame. Though he is make the money but he is paying with his health – high-blood pressure and deteriorating eye sight.

    Nail, i buy your idea. Ever since i started trading 4hrs and daily time frame, i feel relaxed, less stress, i make consistent profit and have time for other things. I am not condemning the lower time frame. Lower time frame works if a well thought out strategy/ trading rules are strictly followed. it all depends on individual who is ready to give what it takes to be successful. so in a null shell, whatever time frame one trades, one should carefully weigh the pros and coin. But for me 4 hrs and Daily is the best.

    Thanks for your insightful articles. you are great. keep the good work alive. Have a nice day.

  55. Luke says:

    Do you want to be a cool day trader that sits at his pc all day, or a swing trader that can cover 16 instruments in 30 min on the daily chart then spend time with ur kids or play golf? I know what I chose.

  56. sonny says:

    Is true “Stop Hunting ” happens all the time. In other articles I have read on the net, some refer to it as “Search and Destroy”. Anyway another great article by the Lord. Have a nice weekend and Allah Ma’ak.

  57. Aliyu Mohammed says:

    I hv suffered a lot of losses in Day-trading. I lost nt less than $15000 in daily trading, and I can nt repeat that nonsense , I hv learn a great lesson of my life.I cant easily 4get that loss. Since I lost my entire capital, I cant trade again. Even if am to re-start forex trading it can nt be on daily basis trading. I will be trading on monthy or quartely basis. Thanks I appreciate this lesson is a great one.

  58. Colin says:

    Hi Nial. Interesting article. Question… are you suggesting that high probability setups do not present intraday? The failed setups you noted on the JPYUSD chart were indeed failures, but there were others that would have yielded a perfectly good intraday result.

    Also, if I am not mistaken, the 5m EURUSD chart you chose as an example reflected one of the least active time periods for the pair on any day, thus the narrow range is to be expected. I can tell you from experience there is plenty of tradeable movement in the pair during the hours the UK/European/US cash equity markets are open.

    To be clear, I certainly agree beginners should focus on the higher timeframes while learning. But suggesting that trading intraday is inherently bad goes a bit far in my opinion.

    1. Nial Fuller says:

      Colin
      Most people that blow up a trading account are day trading/over trading/gambling on shorter time frames. I wrote this article to warn people of the dangers and realities of intraday trading. Only a very small % of traders will ever become good day traders, I would prefer to teach my students a different trading approach, which is why I teach a patient trading strategy on the 4 hour and daily charts.

  59. Anthony says:

    If there is one thing i take home from this It’s the Less is More mindset.
    As well as being a trading account “suicide” Day trading can be detrimental to once’s health.

  60. Aaron says:

    Definitely true. 400 of us trade daily timeframes, make a killing every year and take all of 10 minutes a day to do so. But day traders will always be there because, human nature never changes. Cheers!

  61. KRISTOFA OKENTA says:

    I AM BLESSED BY EACH OF YOUR POSTS. THANK YOU Prof

  62. Radu says:

    Stop Hunting is made by brokers. I have 3 monitors and 3 MT4 on different account and different broker and I can see that.
    A broker who wide spreads more than 2 pips before economic news release is not a fair broker. I saw 10 pips spread on EURUSD before NFP on one broker.
    My advice is to open live accounts but not fund them only after at least one month of behavior monitoring.

    For above article, I can say that to be able to trade on Daily charts we need more money because we need wide stops and can’t risk more than 2-3 % of accounts equity in a trade.
    Till then I’ll make my pips on 5 min TF.
    Excuse my english.
    All the best.

  63. Lyte says:

    Thanks Nial. Today’s lesson only further confirms the importance of using higher time frames like the daily and the four hour charts. Trading these higher time frames takes out the stress gaining a better result by letting the market do the work.

  64. Mytrader says:

    Niall, thank you very much for sharing your experience with us. I really appreciate your explanations. Would you still decide to trade on ‘Price Action’, ‘Pinbars’, ‘Fakey’, etc set ups, on the Daily charts?

  65. Eric says:

    This is a very interesting article. I am playing around with a trading plan that I call the “momentum method”. I was testing it using a very tight stop (usually around 10 PIPs). I then was curious to see if I would make money by applying the same money management principles that I use for the pinbar setup on the daily and the 4 hour. I found it very interesting that I got stopped out about 85 percent of the time. I have since altered my “momentum method” so that there is much more room for price to “wiggle” and have been much more successfull. Stopped hunting definately played a role into why my original plan failed.

  66. Chuks says:

    To an extent I agree with the general point of the article that trading off the higher time frames would generally be more profitable. I want to point out that Trading h4 is technically day trading… Though I do my analysis top-down, I still find the lower frames especially important for near perfect entries in direction of higher frame trends and traders who manage to discover this unique importance will benefit more especially for most retailers who start off with low funds. Not everyone enjoys the feeling of 100-pips-against-you-then-in-you-favor experiences of entering off the higher time frames that we see sometimes.
    At the end of the day, it is all about mindset and what you want the lower time frames to do for you. For me, they serve best for entries.

    Stop hunting is real and undeniable. However, it is not exclusive to lower time frames. Liquidity pool is higher on the higher time frames and surely will incur deeper losses should one experience it. What happens in the day trading time frames is that most traders are completely unaware of the actual prevailing longer term trend. It makes them want to catch whatever pseudo high or low is made thereby providing other smarter traders (doesn’t have to be your broker or the big boys) with more cash to prey on.
    Traders should be advised to start their analysis from the big time frames and work their entries out on the lower ones.
    Over all, nice article but not as controversial as touted.

  67. Bratislav says:

    Hi Nail,
    Great text, I was trying to trade in short period of time as 5min and it is to hard to do. Im now try to do this why and thare are more Chance for success. Thank you for comment. Great regards,

  68. george theodoridis says:

    Hello Nial,
    I find your way very interesting and i agree that higher time frames are more reliable.I would like to ask , how we can enter on trades? after a pin bar on a sup or res we just enter and place a stop above or below the pin bar? or we are looking for change of trend in smaller time frame? this is always tricky for me .
    ps . some time the rejection in a bigger time frame is very big and the stop loss is to high so i dont have a proper risk ratio.
    Thanks a lot .

  69. Ben Ajose says:

    Think i like the most about this site its always confirming suspicions i have had about the Forex market trading successfully, things mainstream websites seem to overlook and discrediting many of the o so popular misconceptions about Forex

    Ben Ajose

  70. Dorian says:

    Thanks again for an insighting article Nial.

    One of the reasons you strike a cord with your community is that you’ve been there and coach from your experience. I remember day trading too, but since you introduced me to higher time frames (4hr and above) in your members course, my trading account is healthier and stress reduced.

    Many thanks.

  71. Mike says:

    I agree, day is tedious ,
    but the minute you swing trade, then you are swing investing also. charts might be cleaner but the risks can be higher.

  72. lawfex says:

    Nialllll, guess some brokers will be getting upset with u. U are the real man especially wen one considers the adrenaline pump while day trading. Thanx man

  73. sean mor says:

    I’m really glad to be part of the LTTTM community, money well spent! Another great article!

  74. Swede says:

    I love the challenge of day trading, fast and furious and when you get to the point of understanding what the market makers,brokers, institutions are looking at, you can then scalp some profit out of the market. But, really tough to get to that point and hard on your account, your emotions, your sleep patterns, your free time, your relationships.

    So, Nial I must agree overall with your summation. If you want to give up all you value in life just keep day trading. The market will eventually eat you up one way or the other.

    Great article, wish I had read it 10 years ago and saved myself a lot of pain.

  75. andy says:

    Hi Niall,
    I agree 4 hour and day trading is best but as ive said before
    i know people who make a living trading 15 minute charts.They say the main problem is people are greedy and try for too many
    pips in one go. why try for a 50 pips at £2 when you can get 10 pips at £10 a pip. As regards the stop hunters which i do think exist, you need a big stop loss but trail it or if your confident of the trend dont have a stop loss. wait for the stop hunters to take their scraps. then when trend continues
    take your 10 pip profit. do this 3 or 4 times during the day
    and Bob’s your uncle. comments please

  76. jotex says:

    Nial,i love this article.i was also a victim of lower time frames.every thing you said about it is really true.over-trading,over-analysis and so on.i scalp with robot,i buy signals,in fact i felt forex wasnt for people like me.i almost magine call ontill d last trade that was going against me.then,i was reading your article that talked about holy grail-daily time frame and i saw a pin bar.i had to adjust my stoploss to d pinbar bottom and leave the trade for 2 days and that was how i got into Nial Fuller’s Professional Price Action Trading.Thanks for all the quick answer to all my questions.have a wonderful weekend Nial.Cheers mate

  77. Grant says:

    thanks for that great article Nial. Agree with you totally i dont know why anyone would want to do that either

  78. Daniel Gisore says:

    Thanks Nial, it is because of your weekly education that I am still doing forex, it took me 8 months of complete failure and 3 months of reading your articles weekly and I posted a profit. Thanks and continue with the same spirit. Though I would request for an article on position placing and leveraging before entering a trade. Thank you once again.

  79. rajiv says:

    wonderful article Nial

  80. Mithun says:

    Good one Nial !!

  81. Anonymous says:

    Other than that, nice article.

  82. Anonymous says:

    Nial,

    Now that I can agree to. Major levels such as swing high/low do have stops that are hunted. But stop hunts happen on larger time frames as well, in fact even more so since the liquidity pool is generally deeper with a daily chart!

    I still can’t agree with FX brokers hunting stops. They stimply don’t have the capital to do so.

    1. Nial Fuller says:

      Regardless of ‘who does the stop hunting’ it is a very real phenomena that occurs very often, mostly on short term timeframes.

  83. joe says:

    Thanks Nial. I’ve been studying the market and different strategies for several years now and I totaly agree with the daily and 4 hr time frame strategies. It’s alot easier and more productive . Before it was an ”ego” thing with me ”day trading” on smaller time frames . Now I want to make money. I’m sick and tired of going nowhere trading. I need the discipline of not looking at my charts every hr or so or staring for hours trying to find a setup. Nial, you make trading fun again, thanks.

  84. Will_B says:

    Nice article Nial :) Very true

  85. Mike says:

    Add “DAILY” to your trading plan…trade less make more and go get more hobbies.

  86. Pliva says:

    So true!
    I’m baby trader (2 weeks of an experience) and I’m still at demo accounts and stressed out when trading on M5-H1 (85% of the time). Thanks to you Nial, yesterday I decided to try H4 time frame and I was so relaxed (comparing to last 10 days) but at the same time so concentrated on my daily job/tasks. At the end, result was incredible. MY account (demo) increased more then last 10 days of trading, I made a great job on the side AND final one, I had restful sleep! Just to point out for the 3th time: I still practice demo!

  87. Anonymous says:

    Regarding “Stop Hunting”… um no.

    First. Stop hunters from the “big boys” could care less about the paltry stops from the very small retail price action traders. You do not provide enough liquidity to justify such a hunt.

    Second. Brokers are NOT hunting your stops. If you believe this, I’d glady like to hear which FX broker you think has enough free capital to make such a move.

    1. Nial Fuller says:

      Sorry, but I disagree “Anonymous’. Stop hunting is very real.
      The charts show this evidence. Eg: price will take out an intraday swing high/swing low where herds of traders have placed their stop losses.
      The stops are triggered and the weak longs/shorts are shaken out of the market, then the market reverses and goes in the opposite direction.
      This is a phenomena that has been happening for decades.

      1. Alexander says:

        Absolutely agree 100%

  88. Siyabonga khanye says:

    Awesome stuff Nial…been trading the 1 hour chart with a lot of effort, sometimes not even sleeping…will definitely consider:-)

  89. Jack says:

    As always very good article Nial thank you.

  90. Ray says:

    Good one Nial..Right on the money

  91. Simmo says:

    Brilliant article and all valid points. I began learning trading via day trading tactics and was inconsistent with winning trades on my demo account. Since using Nialls methods, knowing when to and when not to trade and using higher time frames, consistency of winning trades has improved immensely.

  92. Pavel Karizek says:

    I 100% agree with Nial! I used to trade the 5-minute charts and lost 50% of my trading capital a few years ago. Why such traders like George Soros, Peter L. Brandt or William J. O’Neil do only trade off of the daily and weekly charts?! Even on the 4-hour charts, you have 6 times as much false signals as on the daily charts. I also prefer quality over quantity. Since I only trade off of the daily and weekly charts. I make 8 trades on EUR/USD, 16 trades on AUD/USD, 8 trades on USD/JPY, 4 trades on XAU/USD and 16 trades on USD/CAD on average per year.

  93. Tomson says:

    Thanks for the reminder it’s needed to be said over and over again.

    I have tried it and really lost some money.
    When you first look at it it looks so easy, but it drags you in and don’t let you out again without paying for it (lost some money).

  94. Damien says:

    I’m sorry but I don’t agree with every point. Yes the brokers make more money and you have to be a lot more active. Your first chart usdjpy 15min , all I saw was an aggressive C sell and then stop and reverse for a long all on a simple but effective ABCD pattern. If we both average 50 pips a day I will make more because my stops will be tighter which means a larger position size. I will look at pin bars and structure and fib ratios but they all have to line up at potential reversal zones. I do enjoy most of what you share, Thank you , I appreciate it, but on this subject I wont change my mind.

  95. Sam says:

    Based on your teachings to trade like a sniper with price action strategy, i started trading on the daily TF only since last year August and I got 11 consecutive winning trades by December which skyrocketed my account from $3,000 to $8,000+ as at 4th January this yr. The 12th, which is also the current trade is already in profit heading towards my target.
    I had already sworn and taken the oath to be a higher time frame addict as long as fxtrade is concern.
    Nial, you are blessed.

  96. Egbe says:

    Hi Nial, u suprised me today.i was choked on how this institutional traders are using math to play fast. look at this phrase from u again “As we have seen, today’s retail day-trader is up against some pretty stiff competition in the form of super computers and algorithms that are programmed by math “wizards”. Why waste your time and fry your nerves trying to compete against such players with this type of unfair advantage when there is a much easier and more lucrative way to trade?” bros, from today henceforth i said bye to 1hr and down tf tradin.

  97. abdul rasheed says:

    All your research is just wonderful though it doesn’t quantify the difference of position call and the day trade.
    It shall be well appreciated if you do an article with winning strategy of day trade.
    Because day trade is something you feel that you are in the market.

    Many Many thanks for whatever you are doing to the trading community.

    Abdul Rasheed Mamusha

  98. roberta says:

    Thank you Nial

    I agree with you totally only 4 hour or daily chart which ever been profitable trade for me.

    Love the article

  99. Kyle Edginton says:

    Nial, thanks for the great article. You mention the “stop hunters”. What benefit do these big/institutional traders get from finding stop loses and stopping out the day trader? I can see it benefiting the broker because of more trades.

  100. jim says:

    Agree totally. Looked at binary options recently and they are short term nightmares. How you can make money forecasting what will happen in the next 1,5,10,15,30minutes is beyond me, but I have an open mind and tried a demo account. You guessed it!!!!! I have made steady money in the last year using Nials course and only daily and 4hr charts. Please listen to him

  101. Olusola says:

    Prof Nail.,this is an eye opener.I gain tremendously from the write up.keep it up.

  102. samuel says:

    You can succeed in day trading if you follow a strategy that is based on achieving 10-15pips per trade times 4. However, the higher you fly , the clearer your vision.

  103. phil preston says:

    Nial
    I know of a Proffessional intra Day trader who does Day Trade Forex. But they did tell me, their intial stop has to be 70 pips – why? Because, as you said Brokers have taken the traders stop out!!! It’s only when they are up 20-30 pips, they are able to bring the stop down considerably to avoid such a big potential stop loss.
    Although I agree with you about clarity in trading. Not all day traders lose – some make a fortune. We don’t get to hear about them, because 90% of them lose – Period!! Lets not pretend though Daily time frames are the Holy Grail. For every winner in trading there is a loser. Risk reward is the holy grail period!!! Most Day Traders Overtrade. I believe sucessful trading is based on the pychology of the trader – not the time frame traded. When someone can show me there are no succesful day traders out there at all – Then I stand by that statement!! Cheers

  104. Charlie Boomer says:

    Hi Nial,
    You are spot on mate. It’s taken me a lot of dollars to realise the truth about the shorter time frames, i know a few of the bigger traders think along the same lines.It’s the power of the greed factor that drives most people to trade the lower time frames. Keep up the good work Nial. loved the article!

  105. Paul says:

    I don’t think Sergii’s post above should be ignored. Some traders do make a consistent return on the smaller time frames

    However, Nials message is just ‘why bother’?

    You can trade less frequently, with considerably less screen time on the higher time-frames, with much larger stops (and therefore much smaller lots / or ‘stakes’) and end the month with just as much if not more profit in your trading account
    Trading is not the same as conventional ‘work’ it does not reward you for the number of hours you put in, but for the quality and consistency of the decisions you make and subsequent actions you take

    I personally like to look at the weekly and daily time-frames to find key levels and obvious trends. Then use the lower (4 hour and occasionally 1 hour) ‘price action’ candle formations to provide trade entry and stop levels, with targets being pre-decided from the weekly and daily time-frame.
    This often results in entry’s that are consistent with those that would have been utilised, had I just use Nials 50% re-tracement of the daily candle strategy, so I am moving towards doing this and therefore not concerning myself with the necessity to monitor the 4 hour of 1 hour charts.

    The longer I spend monitoring the charts, the more I want to be ‘in’ a trade. This does not aid sound decision making!

    have a great weekend Nial and every one that follows you. For those in the UK, keep warm & safe

    best
    Paul

  106. JOHN NNY BHAI says:

    Thats right day trading sucks ,i lost lots of money by day trading but now i only trade with 4h and daily chart and have much more good profitable trades than day trADING.

  107. Karl says:

    Nice one…

  108. Maniam says:

    Dear Nial,
    I agree what u said in this article.
    Its a very useful article for all new traders.
    Good luck and Thanks for your support.

    Have a nice day.
    Maniam

  109. Venkat says:

    FANTASTIC Article….as always….

  110. Euan says:

    Nial I think that this is very true and more so about todays choppy market. Having said that trading the longer time frames is for me more taxing as in an 8 hr day I get 2 to 3 candles, then if there is a movement in the 12 – 16 hours I am away I miss the trade, and they are few and far between these days. The daily time frames are far more difficult to read and the odds of getting it right for me are not good.
    My solution to this is the 1 hour charts with wide SL and TP with very low contracts that can take up to 3 – 4 days sometimes.
    Cheers
    Euan

  111. PERI says:

    Thank you for your Great Article !

    Let us (our forum members)take an OATH to adhere to the bigger time frames of 4 hours and above from now onwards !

  112. robert card says:

    Ya hit it on the head again Nial. I’ve been following your site since late last fall and have had 3 of my best months (and less stressed) that I have had in my 3 years trading. I can never thank you enough!

    Robert card
    Appleton WI, USA

  113. jusmijo says:

    Awesome! Thanks!

  114. Mark says:

    Couldn’t agree more Nial.

    Day trading was what I tried to do at first because I thought it was cool and less risk because of smaller stops however once you learn about position sizing you realise this is not the case.

    Even the 4hr has nothing on a daily chart in my opinion. Although it can provide nice entries if used in conjunction with a daily chart.

    As you say, day trading is not cool, it’s stressful as hell. I’d much rather browse my charts for 10 minutes at the close of the day and place a set. & forget trade on the daily.

  115. Mehdi says:

    Absolute truth, thanks a million for the extremely precious article.

  116. Sergii says:

    Hi Nial.
    I do agree with what you said about the difficulties of day trading. Indeed, having day traded myself for three months I know it is really tough to make a consistent profit. However, it does not mean day trading should be avoided by anyone. For each person there exists a trading style which fits his/her psychology. One of the goals for starting traders is to find the right approach to trading in which he/she is likely to make considerable improvement to become consistently profitable. There is no harm in trying, there is harm in keeping your mind closed.

    Thank you for very much for the great website.

  117. edge5 says:

    Hi Nial,

    Do you see a risk that H4 and D1 timeframes also become harder to trade because of HFT?

    Thank you for what you are doing to help people become profitable traders. Cheers.

  118. horlique says:

    I only trade the daily chart on the major pairs. I trade 4hours/daily chart on goldusd and silverusd. I really love the pin bars on the daily chart. Daily chart is the best chart for price action. My news trading + pin bar price action= my trading arsenal. Thanks alot. Hows is Australia n the crocs.

  119. Jim says:

    You’re telling the truth. I know from personal experience.

  120. Kneath Philippart says:

    Always known / believed it – but haven’t had the cojones to make the change to the bigger T/F’s. I think now is the time as I am noticing their value as time progresses.

    Kneath

  121. krishna says:

    thanks a lot for your mind blowing suggestion .i am sure i must follow this lesson.

  122. Alan says:

    I’m constantly fighting being drawn to the dark side i.e. short time frames. Your timely article reminds me of the perils of short term trading. Thank you.

  123. Gosta Strom says:

    Thanks Nail. I have argued with my self for a long time to
    stop using lower time frames. Just a few days ago I started to do as you teaches. Thanks Nail

  124. george theodoridis says:

    Hello Nial,

    I find your way very interesting and i agree that higher time frames are more reliable.I would like to ask , how we can enter on trades? after a pin bar on a sup or res we just enter and place a stop above or below the pin bar? or we are looking for change of trend in smaller time frame? this is always tricky for me .

    ps . some time the rejection in a bigger time frame is very big and the stop loss is to high so i dont have a proper risk ratio.

    Thanks a lot .

  125. Max Champion says:

    Thanks A lot of stuff i knew about but never understood
    Very Very helpfull.

  126. Libs says:

    I hate day trading as well, much easier and less stressful to trade higher time frames. Even in the higher time frames I would find it difficult to know where to put my stop loss. Refer to AUD/USD on daily chart. Would you opt not to trade this considering it’s choppy every day ? I can sense that the AUD is falling and it makes sense to go short but the daily time frame is so unpredictable. You have a bullish pin bar followed by a strong bearish candle. What is your recommendation on trading these choppy markets in terms of risk? Thanks Nial your emails are such a wealth of knowledge to me.

  127. siva says:

    every traders must read and follow this message… dont forget.. dont trade on low time frame… thank you so much nial… you are great …god bless you

  128. Cheetu says:

    Very Very nice article Nial :)

    I will change my plan of execution and save tons of time and efforts, efforts worth much more.

    -C

  129. david NG says:

    awesome revelation! thanks Nial.

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