I would like to calculate the bankfull flow for a certain point on a river. The recurrence interval of bankfull flow varies for different rivers, but is typically always found to be between 1 and 2 years. Let's imagine I decide to set the recurrence interval at 1.67 years, which gives me an exceedance probability of approximately 60% ($\rm Pr(X\geq0.60) = Pr(X\leq0.40)$).
Supposing I have a stream gage at the point I am interested in estimating bankfull flow for, and I recorded hourly discharge values for 20 years, which set of values should I use to calculate the recurrence interval? Should I determine the value associated with this exceedance probability using all hourly flows, the daily mean flows, the annual high flows (what the USGS calls instantaneous peak flows), or some other subset of values?