Patrick Niel is a multiple-time world trading champion. He reports that he has ranked among the world's best traders for five consecutive years. In an interview with Brent, he described his approach to market structure, risk, and psychology, and he walked through his method on live charts.

Core Approach

Niel describes himself as a discretionary, counter-trend trader. He says he prefers to take positions opposite to the majority of market participants. He states that he trades discretionarily but still works within defined rules.

His strategy is based on the PBD model, a framework taught by Thomas, who developed it. Niel and Thomas run an academy together. Thomas teaches the rules behind the model in his online coaching programs.

Niel says the model is not complex. He notes, however, that applying it well takes practice. He states that others can learn it, although not necessarily to the same level of precision.

The PBD Model

The model identifies two price patterns:

• P (impulse up): A strong upward move followed by a range.
• B (impulse down): A strong downward move followed by a range.

Niel's process is as follows:

1. Identify the larger context. Before each session, he looks for where large market participants are active and which structures are present.
2. Locate impulse and range patterns. He focuses on impulses that occur in good zones.
3. Wait for the breakout. After an impulse and range, he waits to see whether price moves further in the impulse direction. He trades after the impulse rather than during it.
4. Trade the range when conditions allow. If the range is well defined, he trades its boundaries until price breaks out.

Niel says that the PBD structure appears in most markets. He cites the DAX as an example.

Market Profile and Order Flow

Niel uses weekly volume-based market profile to identify value area highs and lows. He says these levels are important for locating trade opportunities.

He describes the market profile as a tool that shows:

• Where market participants have accepted prices.
• Where the market is likely to move quickly and where it is likely to move slowly.

He states that market profile is not exact and is not a complete system.

Execution timeframe: Niel uses the 15-minute chart for trade entries.

Footprint and order flow: He reviews footprint and order flow when a trade setup appears and he is in front of the screens. He says this review improves entry precision. He acknowledges that he does not do it every time because he is often away from the screens.

When the impulse and range align with the same market profile level, Niel says the setup is stronger.

Trade Duration

Niel typically holds trades for:

• Part of a day, or
• Four hours to three days.

He contrasts this with scalping. A member of his team scalps and takes many trades per day. Niel describes that style as unsuited to him. He describes himself as a slow trader and says each trader must find the approach that suits them.

He acknowledges that high-frequency scalping can produce consistent results. He cites a friend who takes about 100 trades per day and reports that his last losing day occurred three years ago. Niel notes that a trader taking five trades per day can lose on all five in a single day, which he describes as normal.

Stop Loss and Profit Targets

Stop loss: Niel states that a stop loss must be defined before entry, because it determines position size. He places stops based on one of the following:

• Beyond the zone.
• In the middle of the zone.
• Behind a structural point.
• Based on volume in the last candles.

Profit target: For impulse-based setups, Niel typically places the profit target below the impulse. He states that price often returns to the start of the impulse.

Trade management: In swing trades, Niel reports his best results when he does not actively manage open positions. When he is in front of the screens, he manages trades and may exit early if conditions weaken.

Risk Management

Niel's core risk rule is:

"I never risk more than 1% in my own portfolio."

He states that this limit keeps drawdowns manageable. He acknowledges that he has broken the rule two or three times in his career. On each occasion, he reports that he lost money.

Competition and Personal Accounts

Niel describes different risk parameters for competitions and personal accounts.

He reports the following about his trading statistics:

• Win rate: 50–60%.
• Losing streaks: Up to 10–20 consecutive losses are possible.

He states that a personal account cannot sustain this variability at high risk per trade.

Worst Trade: Oil During COVID

Niel describes his worst trade as a long position in oil during the COVID period.

• Oil fell from roughly 40 and 30 to 20, then to 15 and 13.
• He added to the position as the price declined, expecting a reversal.
• Oil fell to 8, then to 5. He closed the position at a substantial loss.
• Oil later traded at minus 42.

Niel says he had not considered that oil prices could turn negative. He had assumed the maximum risk was a decline to zero. He states that this event made the importance of strict risk rules clear to him.

Drawdown Limits

Niel uses drawdown as the main measure of strategy consistency. He sets the following thresholds:

• He is concerned by drawdowns greater than 10%.
• A strategy with a drawdown above 20% is not suitable for him.
• He describes 20% as the maximum drawdown he considers tolerable.

He explains the recovery required after a drawdown:

Niel reports a 20% drawdown in a world championship and a earlier drawdown in his private account. He says that he recovered by continuing to trade the same method. He states that changing a strategy during a drawdown is only appropriate when the trader fully understands the strategy.

Psychology and Discipline

Niel describes himself as calm by temperament. He says his students often struggle with emotional control.

When he feels pressure or frustration, he does the following:

• He stops trading for the day.
• He spends time with his children.

He states that this routine helps him return to the next session with a clear approach.

He identifies the following as the main sources of poor performance:

• Trading while nervous or in a poor emotional state.
• Taking consecutive losing trades, which leads to further losses.

Backtesting and Testing

Niel supports backtesting and considers it essential for evaluating new strategies. His testing process includes the following:

• Historical testing: He checks whether a strategy has produced consistent results over approximately five years, because many strategies perform well for a few months before failing.
• Live testing with small capital: He tests new strategies with a small amount of real money. He states that testing with real money produces a more accurate assessment than simulated testing.

He prioritizes consistency over peak performance when reviewing backtest results.

Fundamental Analysis and News

Niel primarily uses technical analysis. He states that technical analysis can perform well without fundamental analysis.

He reduces exposure around major news events. He says a team member analyzes news and explains its implications to the team, while he prefers to remain out of the market during major announcements.

As an example, Niel describes a value area high from two weeks earlier, where price stopped during a period of news involving Iran and Trump. He cites this as evidence that technical levels can hold regardless of news flow.

Advice for Developing Traders

Niel's recommendations include:

• Use a single, defined strategy. He states that studying too many strategies leaves traders without a clear approach. He cites traders who become lost among 20 or 30 strategies.
• Keep a trading journal. Review trades, identify those that followed the rules, and repeat those.
• Test before committing capital. Use historical data and small live positions.
• Accept that no single method guarantees results. He states: "There is no holy grail in the trading business."
• Expect gradual progress. Niel draws on an interview with actor Tom Cruise, in which Cruise described learning skills step by step. Niel applies the same principle to trading and states that experienced traders developed their skills through sequential practice.