Lucid Trading Prohibited Trading Strategies (What Gets You Banned

If you trade with Lucid Trading, the fastest way to lose an account isn’t a bad trade — it’s using a strategy Lucid classifies as system manipulation.

This guide breaks down all prohibited trading strategies at Lucid Trading, explains how their detection actually works, what happens on first vs repeated offenses, and—most importantly—how to stay compliant without neutering your edge.

No legalese. No scare tactics. Just the rules as they’re enforced.

Learned the hard way: I've breached Lucid accounts, passed Lucid accounts, and spent 18+ months figuring out which rules trip traders versus which ones are manageable. This reflects trial-and-error experience—including my mistakes.

The single most important rule at Lucid is the EOD trailing drawdown—it's fundamentally different from intraday drawdown most firms use, and that difference changes how you size positions and manage risk during volatile sessions. I broke it down in my complete max drawdown guide, including real scenarios and exactly how to calculate safe position size. For the absolute latest, check Lucid Trading's website or their help center.

Lucid Trading’s Core Principle: Trade Like a Professional

Lucid’s rulebook is built around a single idea:

They want to fund transferable, real-world trading skill — not platform exploits.

That philosophy drives every prohibition below. If a tactic:

• artificially reduces risk,
• exploits simulated fills,
• or wouldn’t survive in a live professional environment,

…it’s likely prohibited.

Quick Overview: What’s Prohibited at Lucid Trading

Prohibited Strategy #1: Hedging (In All Forms)

What Lucid Means by “Hedging”

At Lucid Trading, hedging does NOT mean portfolio diversification.

It specifically means:

• Taking opposing positions on the same instrument
• Across multiple accounts, multiple users, or multiple firms
• With the intent to neutralize risk and guarantee a winner

Examples That Will Get You Flagged

• Long NQ on Account A, short NQ on Account B
• Long ES minis, short ES micros (same or different accounts)
• Coordinated trades between friends to sacrifice one account
• Hedging across Lucid + another prop firm

What Is Allowed

• Long one instrument and short a different instrument in the same account
• Directional correlation trades without account separation
• Legitimate spread strategies within one account

Penalties

• First offense: warning + profits removed
• Repeated offenses:
  • All accounts closed
  • Remaining profits forfeited
  • Permanent ban from Lucid Trading

Lucid uses automated correlation detection — this is not guesswork.

Prohibited Strategy #2: High-Frequency Trading (HFT)

What Counts as HFT at Lucid

HFT is defined by:

• Extremely high order volume
• Very short execution intervals (milliseconds / seconds)
• Algorithmic speed advantages
• Infrastructure stress on the platform

This is not about being “fast.”
It’s about volume + speed + automation.

What Happens If You Use HFT

• First detection: written warning
• Repeated detection:
  • Profits removed
  • Accounts closed
  • Permanent restriction

Lucid is explicit: HFT is not compatible with their infrastructure or evaluation goals.

Prohibited Strategy #3: Microscalping (This One Catches Many Traders)

What Lucid Defines as Microscalping

Microscalping is not normal scalping.

Lucid flags you if:

• More than 50% of your profits
• Come from trades held 5 seconds or less
• Using very large size to exploit simulated fills

This is a statistical trigger, not a subjective opinion.

Important Distinction

• ✅ Scalping: Allowed
• ❌ Microscalping: Prohibited

If your strategy relies on:

• Instant liquidity
• Unrealistic fill assumptions
• Platform latency

…it will not survive review.

Enforcement Process

1. Automated detection
2. Manual review
3. Warning (if confirmed)
4. Profit forfeiture + ban if behavior continues

Appeals are allowed — but only if behavior is genuinely misclassified.

Prohibited Strategy #4: Platform & System Exploitation

Lucid explicitly prohibits:

• Exploiting system errors or delays
• Trading during known update windows
• Using price discrepancies unique to the simulator
• Any tactic that wouldn’t exist in live trading

This includes creative edge-hunting that crosses into bad faith.

Lucid’s stance is clear:

“We fund traders — not opportunists.”

What Happens If You’re Flagged?

Lucid’s enforcement model is progressive, but firm:

• Automated detection
• Manual confirmation
• Warning before permanent action (except severe abuse)
• Clear appeal process

However, repeat violations = permanent exclusion.

This is not negotiable.

Why Lucid Is So Strict (Context Matters)

Lucid’s rules aren’t random. They exist because:

• Simulated environments are vulnerable to abuse
• Hedging and microscalping break evaluation integrity
• HFT degrades platform quality for everyone
• Live capital requires realistic behavior

Lucid is optimizing for long-term funded traders, not challenge churn.

How to Trade Safely Within Lucid’s Rules

Do this:

• Trade one account per strategy
• Hold trades longer than a few seconds
• Use realistic size relative to liquidity
• Accept losses without “offsetting” elsewhere
• Trade like the fills are real (because payouts are)

Avoid this:

• Multi-account games
• Sacrificial account logic
• Ultra-short duration size spikes
• Coordinated trading with others
• Anything you’d hide from a risk manager

Final Verdict: Are Lucid Trading’s Prohibited Strategies Reasonable?

Yes — if you’re a real trader.

Lucid’s prohibitions are:

• Clearly defined
• Actively enforced
• Aligned with professional trading standards

They are not beginner-friendly, and they are not loophole-tolerant.

If your edge depends on system behavior, Lucid will eventually catch it.
If your edge is real, these rules won’t affect you at all.