Daily Drawdown Limit

What is a daily drawdown limit?

A daily drawdown limit is the official account floor that applies during one firm-defined trading day. Some firms call it maximum daily loss.

If the account value measured by the rule reaches or crosses that floor, the firm may treat it as a violation. The exact calculation and consequence come from your named program.

Check these four things before you trade

1. Reference value: what number sets today's floor?
2. Measured value: does the rule test balance, equity or another value?
3. Included amounts: do open P&L, swaps and commissions count?
4. Reset time: when does the firm's trading day restart?

Do not assume the reset happens at midnight in India. Check the firm's current server time and dashboard.

A fictional $100,000 XAUUSD example

Imagine you are holding an XAUUSD London-session breakout. Your dashboard shows an official daily floor of $95,000. Open loss and costs bring the measured equity to $96,200.

$96,200 − $95,000 = $1,200 buffer above the floor.

The $1,200 is not an amount you should risk. It only shows the current distance from the official floor. Your planned trade risk should come from your own risk-per-trade rule.

Two current rule examples

Checked 8 October 2026.

• FTMO 2-Step: the checked page uses a 5% Maximum Daily Loss amount based on the initial simulated capital. It recalculates the floor at 00:00 CE(S)T from the balance recorded then and tests equity including open P&L, swaps and commissions.
• FundedNext: the checked page lists 5% for Stellar 2-Step, 3% for Stellar 1-Step and 4% for Stellar Lite. It says running loss and closed loss are counted.

These are dated examples from named programs. They are not standard limits for every firm. Both checked sources describe crossing the applicable limit as a violation, but the exact account action must be checked in your own program's current rules.

What should you do next?

Before your session starts, copy three lines from the current dashboard or rule page: the official floor, the value the firm measures and the reset time. Then use the daily drawdown calculator to check the buffer without treating it as planned risk.

Read overall drawdown limit separately because the daily and overall floors can both apply at the same time.