A trailing drawdown isn't a loss limit — it's a giveback limit. Under an intraday (real-time) trail, the floor ratchets up at the peak of your open profit, so even winning trades can shrink your usable cushion. Model it below with your own numbers.
Every new equity high drags the failure floor up to stay exactly your trail distance behind it — and the floor never comes back down. Under an intraday trail, "equity high" includes the peak of an open trade. A trade that runs to +$900 and exits at +$400 banks $400 — but the floor ratcheted up at the $900 peak, so your cushion shrank by $500 on a winner. Under an EOD trail only your end-of-day balance moves the floor, so intraday giveback is forgiven.
Strategies that hold through pullbacks — trend following, breakouts with wide targets — give back open profit by design. A normal backtest only records the exit, so the equity curve looks clean while the trail quietly eats the cushion. That's how a genuinely profitable strategy fails an evaluation on the exact same trades.