FTMO Challenge Rules: What Automated Traders Must Know
FTMO lets you run an Expert Advisor, which is one reason so many automated traders pick it. The catch is that the rule most likely to end your challenge is rarely the profit target.
It is usually one of the loss limits, or a line in the forbidden practices list that a bot can trip in seconds while you are away from the screen. This guide walks through the 2026 FTMO rules from an automated trader's point of view, so you know which numbers your strategy has to respect before you pay the fee.
One note before the details. FTMO updates its rules often, and the exact figures can depend on your account type and region. Treat this as a working map, then confirm the specifics for your account on FTMO's own pages before you commit.
FTMO Offers Two Paths In 2026
FTMO now runs two evaluation formats, and the one you pick changes the limits your EA has to trade inside.
The 2-Step Challenge is the classic format, with two phases:
- Phase 1 target: 10 percent
- Phase 2 target: 5 percent
- Max daily loss: 5 percent
- Max overall loss: 10 percent, static, so the floor never moves
- Trading days: 4 per phase, with no time limit
- Profit split: 80 percent, rising to 90 percent through the Scaling Plan
The 1-Step Challenge, launched in February 2026, runs everything in a single phase:
- Profit target: 10 percent
- Max daily loss: 3 percent, tighter than the 2-Step
- Max overall loss: 10 percent, trailing, so the floor rises as the account grows
- Best Day Rule: no single day can be more than 50 percent of your profit from winning days
- Trading days: 4, with no time limit
- Profit split: 90 percent from the first withdrawal
Across both, account sizes run from 10,000 to 200,000, fees are refundable once you pass, and the Scaling Plan can grow a funded account up to 2 million over time.
The Loss Limits That Actually End Challenges
For an automated trader, the drawdown rules matter far more than the profit target. A high frequency or poorly optimized bot can breach these limits in seconds, long before a target is ever in reach.
Daily Drawdown Is Equity Based
The maximum daily loss is measured on equity, not just closed balances. It counts your current balance plus the floating profit and loss (PnL) of open positions, including swaps and commissions.
Current Equity = Balance + Floating PnL ± Swaps − Commissions
FTMO resets this daily limit at 00:00 CE(S)T every night. If an EA holds a deeply losing position into the market rollover, it can breach the daily limit on floating risk alone, without a single trade being closed.
Static vs Trailing Overall Drawdown
- On the 2-Step Challenge: the 10 percent overall loss limit is static, anchored firmly at 10 percent below your starting balance.
- On the 1-Step Challenge: the overall loss limit trails upward. As your closed balance grows, the loss floor moves up with it, which permanently reduces your breathing room if the account later pulls back.
The takeaway is simple. Your strategy needs a position size and a stop that keep both the daily swing and the total drawdown inside these numbers, even on its worst run of trades.
Does FTMO Allow EAs? Yes, With Conditions
FTMO explicitly allows Expert Advisors on MetaTrader 4, MetaTrader 5, and cTrader. There is no pre approval step and no requirement to submit your source code. Standard systematic styles are all fair game, including trend following, breakout, and mean reversion.
The governing principle is that your EA has to trade like a normal market participant. It cannot exploit platform inefficiencies, manipulate pricing, or run strategies that do not reflect real market trading. As long as your system behaves like a discretionary trader would, just faster and without emotion, it sits inside the rules.
The Rules Automated Traders Trip On
These come from FTMO's Forbidden Trading Practices, and they catch bots more often than people:
| Forbidden Practice | The Risk to Automated Traders |
|---|---|
| Server Request Cap | Caps you at 2,000 order actions a day. An EA that edits its stop or target on every tick can trip this fast. |
| HFT & Tick Scalping | Dozens of trades a minute, or millisecond holding times, get flagged as latency abuse. |
| Latency Arbitrage | Exploiting delayed pricing feeds between the FTMO server and other brokers is prohibited. |
| External Copy Trading | Copying your own strategy across your own accounts is fine. Copying a public commercial signal service is banned. |
| Cross-Account Coordination | Hedging positions or matching entries across different user accounts disqualifies everyone involved. |
| Allocation Cap | FTMO caps total capital allocation, typically 400,000 before scaling. If many traders run the same off the shelf EA, the combined capital can breach this shared threshold. A custom or optimized strategy avoids the risk. |
| News Limit (Funded Accounts) | Standard accounts block trades within about two minutes of high impact news. Swing accounts are exempt. |
Keeping A PineConnector Setup Compliant
PineConnector sends your TradingView strategy to an FTMO MetaTrader account. A few choices keep it inside the rules above:
| Setup Step | Why It Keeps You Compliant |
|---|---|
| Use an FTMO MT5 account | PineConnector runs through MetaTrader and is built for MT5. Our TradingView to MT5 guide covers the connection. |
| Trigger once per bar close | A handful of orders a day sits far below the 2,000 request cap. |
| Put the stop and sizing in the alert | Risk based commands like vol_pct_bal_loss with sl_pips keep each trade inside the 5 percent daily and 10 percent overall limits. See the syntax guide. |
| Send your own signal | Use your strategy logic, not a relayed signal service. |
| Add a news filter | Skip the news window on a standard funded account. |
For a wider look at which prop firms fit automated TradingView trading, see our best prop firms guide.
FTMO gives automated traders real room to work, as long as the strategy trades like a disciplined human and stays inside the limits. Get the sizing and the order frequency right, and the rules stop being a threat and become a checklist.
Start your free 14-day trial with us here and send your first automated trade from TradingView to your FTMO MT5 account today.