Hard breaches are critical violations of our set rules. A hard breach occurs when a trader surpasses the maximum daily loss or overall drawdown threshold, leading to the immediate termination of the account.
Daily Drawdown (Equity-Based with Trailing on Open PnL):
The Daily Drawdown is strictly based on your account’s equity, which includes both closed and open trades (floating PnL). It is set at 3% below the highest equity at the start of each trading day (00:00 UTC).
This means your drawdown limit trails upward with your open profits and adjusts daily to protect capital gains, but it does not reset downward if your equity falls.
Example:
You start the day with a $10,000 account.
At 00:00UTC, your equity is $10,000.
3% Daily Drawdown = $300.
Your stop-out level for the day = $10,000 - $300 = $9,700.
Now suppose you open trades and your equity rises to $10,500 (due to floating profit):
Your new drawdown limit becomes $10,500 - 3% = $10,185.
This new level trails your profits. Even if the profit is not closed, the drawdown will still move up based on your highest floating equity.
If your equity drops below $10,185 anytime during the day, even from floating losses, you will be in breach of the Daily Drawdown rule.
At the next day’s rollover (00:00 UTC), the drawdown is recalculated based on the new highest equity (including open PnL) at that time.