I’ve gone through the forums and it appears that the system has actually been a long-time fan favorite, but was only submitted recently. One problem was that mechanics and trading rules were presented in the form of a 42-page document. As is the case with most humans, it was deemed TL;DR (too long; didn’t read) and many didn’t bother with it.
The good news is that forum user phil838 decided to pick one of the strategies and simplify it for everyone else. According to him, he’s had a 70% win rate using that simplified strategy, which is actually rather quite impressive.
What I find even more interesting is how the system doesn’t make use of any technical indicators at all!
Backtesting period: February 2012 to July 2013
Draw scalp lines at recent swing highs and lows. Place buy stop orders ten (10) pips above the swing high for long trades, and sell stop orders ten (10) pips below the swing low for short orders.
In order to establish the swing high or low, the preceding trend must be of at least four (4) candles and the succeeding trend should be four (4) candles as well.
Set a stop loss of 50 pips and a profit target of 50 pips.
Note that the specified 10-pip buy/sell stop order above/below the scalp line and the scalp line qualifications have been added by yours truly in order to make the system less subjective. With that, the results may not 100% accurately reflect the results that phil838 or Nick B have gotten but it could still be a good approximation.
For now, I will retreat to my pod to crunch the numbers. Next week, I will be posting the backtesting results and the grades of the system based on my framework for mechanical systems. Stay tuned!