Drawdown & Loss Monitor

Trailing Drawdown Monitor

Floor moves up as your account grows; tracks your drawdown and alerts you as it nears the limit.

How It Works

The trailing drawdown rule tracks your account's highest point (high water mark) and calculates a dynamic floor below it. As your account grows, the floor rises with it — but it never goes down. If your equity drops to the floor, PipsGuard closes all positions and pauses trading immediately.

This is the most important rule for prop firm traders. Most prop firms (FTMO, FundingPips, The5ers, The Funded Trader) use trailing drawdown as their primary disqualification metric. PipsGuard enforces the exact same logic automatically, so your account is protected even if your MT5 platform crashes.

The rule supports three drawdown calculation types:

Real-time equity — tracks live equity including floating P&L. Strictest mode.
Closed balance — only updates when trades close. More lenient.
End-of-day balance — updates once per day at market close. Matches some prop firm rules.

Zone Tracking

PipsGuard uses a color-coded zone system to show how close you are to the limit:

GREEN ZONE 60%+ buffer remaining — trade freely

YELLOW ZONE 30–60% buffer — caution

RED ZONE 15–30% buffer — high alert

CRITICAL ZONE Under 15% — one bad trade away from breach

Configuration

Parameter	Default	Description
max_drawdown_percent	5.0%	Maximum drawdown from high water mark
drawdown_type	trailing	Type: trailing, static
trailing_type	real_time_equity	How HWM is calculated: real_time_equity, closed_balance, end_of_day_balance
protection_mode	protective	protective (auto-close) or alert_only (notify only)
lot_reduction_threshold	60%	Start reducing allowed lot sizes at this consumption level
force_close_threshold	90%	Force-close all positions at this consumption level

When This Rule Fires

Pre-trade: Blocks new trades if drawdown is in CRITICAL zone.

Monitor: Closes all positions if equity drops to the floor.

Best For

Prop firm challenge traders Funded traders Traders who have blown accounts from drawdown

Pro Tips

For Prop firms: The total trailing limit is 5%, so set max_drawdown_percent to 4% — PipsGuard closes everything before you hit the real breach, leaving a 1% safety buffer. Use real_time_equity mode — Propfirms track equity in real-time.
For personal accounts: Consider closed_balance mode for a less aggressive approach.
Start with 60% lot_reduction_threshold to naturally de-risk before hitting the limit.

Configure This Rule →

Set up trailing drawdown protection in your dashboard.