Forex Strategies to pass the FTMO Challenge

FTMO is a “Proprietary trading firm” meaning a financial firm or commercial bank that invests for direct market gain rather than earning commission dollars by trading on behalf of clients. It’s also called “prop trading”. They recruit talented forex traders to trade with their capital for a 70/30 split of profit (70% for you the trader). To be sure the trader is suitable, they must pass a 2-step evaluation challenge where you meet profit targets and have losses within limits.

The FTMO challenge is the initial test proving your strategy is viable. The profit target is quite high at 10% within 30 days, however this is reduced to 5% in the 2nd stage of the challenge which is 60 days. We passed the challenge by increasing the lots to be a little more aggressive in the 1st stage challenge, then reduced it afterward to be conservative.

That’s the million-dollar question! There’s no “correct” way. We’ve noticed support and resistance is a popular method, but this is manual trading which doesn’t suit everyone. We prefer automated strategies. Manual trading is more efficient but labor-intensive. The inefficiencies of automated trading need to be overcome with money management, and a system that compensates for imperfect entries. ‘Averaging’ is a method of allowing for imperfect entries. This involves running multiple small trades, adding new positions when the price moves backward. Positions are small, and the trades are definitely closed for a loss at a reasonable threshold. Never infinitely add positions or use martingale etc. It’s guaranteed to blow your account eventually.

We believe so, as it’s a source of income. It’s nice trading with up to $200K of other people’s money. It suits those who either don’t have a lot of capital available to trade or are somewhat risk averse. We started with the minimum challenge, and recommend the same. This is €155 for €10,000.

If you don’t fail the drawdown limits (5% daily, 10% total), but have a positive balance under the 10% profit target, you can try again for free. If you fail the drawdown limits, then the challenge is forfeited. It’s best practice to test your strategy on a demo account before proceeding to the challenge to ensure your settings are correct etc. FTMO is actually trading on demo accounts, then they copy trade from that. So demo trading is perfect simulation of the FTMO challenge. All our strategies have been run multiple times on demo accounts, and on real FTMO challenges to hit the profit targets.

Far more automated strategies fail than actually work. We have many failed strategies and plan to publish these for our readers in the near future.

They’re quite robust. Robustness comes from removing sensitivity to assets and timeframes, and design principals that reflect actual trading conditions. Examples include non-repainting, closed bars, no over-optimizing, ability to take market blows, and script stablity.

I’m an active FTMO member, a professional coder, and have been forex trading for 5 years. Instead of generic trading scripts available on the internet right now, I have created a set of unique automated trading strategies tailored to FTMO trading only. Check out the trading account results on each strategy.

No. We stay aware of curve fitting data. The strategies are robust meaning not overly sensitive to input changes. An over-optimized strategy fails hard with changes in inputs.

FTMO needs a balanced set of trading strategies, not a bunch of people copying trading. This is solved by using slightly random settings with EMA’s and profit targets etc. For example, instead of using 1000 EMA, use 970. Instead of a 100 pip profit target, use 95 pips. When everyone slightly randomizes the conditions, then the entries and exits are varied whilst still maintaining the strategy concepts.

Montecarlo and ‘risk of ruin’ calculations. This takes the win rate, average win, average loss then mathematically projects forward say 10,000 trades to determine the probability of drawdowns. We use an 8.0% drawdown as a basis as this is inside FTMO’s limit of 10.0%. So the strategy is tuned so that the calculated result is a 0% chance of an 8.0% drawdown.

There is no one-size-fits-all as different timeframes have different volatility ranges. However, you can test new settings with backtesting and forward testing on demo accounts. We advise passing a 12 month backtest, and 2 months on a demo account.

There is no one-size-fits-all as different assets have different volatility ranges and spreads. However, you can test new settings with backtesting and forward testing on demo accounts. We advise passing a 12 month backtest, and 2 months on a demo account.