During both the Evaluation and Funded Phases, you'll be subject to a Max Daily Loss (Drawdown) limit of 3.5% of your prior day's ending balance or equity (whichever is higher). Your Max Daily Loss equity level will be recalculated each day at 5:00 pm EST based on the higher of your ending day balance or equity.
For example, if your account starts with $100,000, your max daily loss will be set at $3,500. If your ending balance or equity (whichever is higher) for the day is $102,000, then your daily loss limit equity level (i.e., the equity level at which your account breaches) will be $98,500.
It's worth noting that any profits made during the trading day won't affect your daily loss limit equity level and will instead function as a buffer for that day.