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2007-2008 Yohanes R. Gagahlin -
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Dreambuilder-FX
TECHNICAL REPORT
Version 1.0 - Build 811
(Release Nov 1, 2008)
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DISCLAIMER
Trading in the off exchange retail foreign currency market is one of the riskiest forms of
investment available in the financial markets and suitable for sophisticated individuals and
institutions. The possibility exists that you could sustain a substantial loss of funds and
therefore you should not invest money that you cannot afford to lose. Nothing in this
presentation is a recommendation to buy or sell currencies. Forex Hope and Switch Capital
Management are not liable for any loss or damage, including without limitation, any loss of
profit which may arise directly or indirectly from the use of Forex Hope and Switch Capital
Management tools or reliance on such information. Past results are not indicative of future
results.

No claim is made by Forex Hope and Switch Capital Management that the market information
and/or trading methods shown in this manual will result in profits or will not result in losses.
Trading the Forex may not be suitable for all recipients of this manual. Always seek competent
professional advice when considering any trade. All examples in this manual are for
educational purposes only. All material and examples in this manual are based on information
obtained from sources that are believed to be reliable, but which are not guaranteed as to
their accuracy or completeness. Forex Hope and associates of Forex Hope have at times in the
past and may now or at times in the future, trade or have traded any or all of the issues used
as educational examples in the manual. Any thoughts or opinions expressed in this manual are
subject to change without notice. No information provided in this manual should be construed
in any way as an encouragement by the author, publisher or distributors to trade. Each trader
must make his or her own decisions with regard to trading. Each trader must be responsible
for his or her own decisions and his or her own actions, if any.
Reading this manual or parts thereof constitutes acceptance of and agreement to this
disclaimer and exempts Forex Hope, the author, publisher and distributors from any and all
liability and litigation.
Important Forex Dealer/Broker Information

The MetaTrader 4 platform is used by over 100 broker/dealers around the world. It is your
responsibility as a trader to fund the broker you feel most comfortable with. Any links to
brokers listed on our website are there for your convenience only, and should not be
construed as recommendations to trade with them.

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WARNING
YOU ARE NOT AUTORIZED TO SELL, COPY OR RE-DISTRIBUTE THIS PROGRAM
THAT INCLUDES SHARING ON FORUMS. VIOLATORS WILL BE PROSECUTED TO
THE FULLEST EXTENT OF THE LAW. COPYTOGHT INFRINGEMENT IS NOT
TAKEN LIGHTLY.

DREAMBUILDER-FX, IT'S TRADING TECHNIQUES AND ITS SOURCE CODE IS
COPYRIGHTED. THE AUTHOR YOHANES R. GAGAHLIN IS THE SOLE OWNER
OF THE CODE AND TRADING METHOD AND ONLY HE HAS THE RIGHT TO
COPYRIGHT AND TRADEMARK DREAMBUILDER-FX AND POINTBREAK EA,
ITS SOURCE CODE, TRADING SYSTEM AND METHOD.

LEAVE THE AUTHORS NAME AND EVERYTHING IN THE DOCUMENT AS
ORIGINAL; DO NOT REMOVE ANYTHING FROM THE FILE.

YOU MUST RUN THIS AUTOMATED TRADING SYSTEM ON DEMO ACCOUNT
SEVERAL WEEKS BEFORE YOU RUN IT ON LIVE ACCOUNT WITH REAL MONEY.
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DREAMBUILDER-FX (DTS-1) TRADING SYSTEM
"Lin, Just want to say that I really appreciate what you are doing with EA's.
You once again have proven that your EA works! I have tried numerous other EA's over the last
few months (partly because of the long period of ranging market which wasn't great for Point
Break), but to be honest, every time I end up coming back to Point Break!!
It is so far the only EA that has proven to work long term in live account!
Others do great for a while, but then they crash! Keep up the good work!
Again, thanks for all the great work!"
~ Tobias
Two years ago I invented the PointBreak trading system and conducted lots of seminars
introducing my unique trading strategies in many cities. Until now PointBreak 5.0 (PB5) has
been downloaded more than a thousand times from our website itself, not including our
affiliates and partner websites.
Since then I also conducted countless hours of researching, reprogramming, recalculating,
back testing and forward testing PointBreak trading system to find new ways to improve the
performance. Investigating and analyzing many ways of using different methods has been a
very long and thorough process.
It took me two years before I finally came to this new system. The main challenge has been
that of filtering out sideways price movement without also filtering out optimal entry when the
market is trending, and optimal exits and closing profit when the trend has finished. I will be
revealing the major points of this journey in this report, along with providing my conclusions.
After spending several months in forward testing of these new techniques, I'm ready to launch
the advanced version which is now part of our complete trading strategy (Dreambuilder-FX).

Basic Concept:
I found many trading systems or expert advisors in the market that produce profit in a short
time period but eventually fail in the long term. They always need new optimization settings
when the market changes (sometimes after several big losses or after the account has blown
up). Many of us have tired of trying to find a profitable trading system that can be used for the
long term and have decided that "No EA can work all the time".

My purpose behind PB5 and Dreambuilder-FX is to make a consistent and profitable trading
system for the long term. The system needs no periodic optimization, but it will produce
consistent profit.
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This report explains the first system of the DTS complete trading system: DTS-1
(for EURUSD).
The main strategy behind DTS-1 is Pyramiding (used by PointBreak5 which has produced very
good returns in trending markets, but produces temporary drawdown in sideways/choppy
markets), combined with several new techniques that make some adjustments when the
market changes (from trending market to choppy/sideways market).
In PB5 strategies, drawdowns are simply a necessary evil in order to put the long-term
probabilities in our favor. What this means is that the long-term probabilities are supporting us
if we have proper exits or preventative measures in place to keep the risks lower. In the short
term it will cause temporary drawdown.
Note:
I will try to explain the logic behind DTS-1 as simply as possible.
If you are not familiar with our PointBreak trading system and our unique way of using
the pyramiding technique I suggest reading our PB5 manual first.
To download PB5 manual:
Point Break 5.0 Expert Advisor Manual
Do I make consistent profit using PB5 ?
I meet with hundreds of people every week through our forex seminars and managed funds
program. There are additional videos on our website about our forex seminars. Every week I
open my personal trading account in front of them, and we have more than a hundred clients
in our managed account program (and until today no one has lost money).
Download example of one of our client's live reports:
Live Client Statement using Point Break 5.0 Expert Advisor
On the example account, we traded using PB5 for more than a year (Conservative Setting).
Note: The account made profit from $25K into $36K (after we charged 0.5 pips commission
and 35% profit sharing).
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Brief comparison between DTS-1 and PB5:
The logic behind DTS-1 solves the drawdown problem of PB5 in choppy/sideways and reversal
markets. It also reduces the maximum drawdown period of PB5 from 5 months into 2 months
(based on Jun 2004 - Aug 2008 data history):
DTS - System 1
Point Break EA
Trading Technique

Pyramiding Technique

Moving Starting Point (MSP)
Technique
Inverted Technique
Contrarian Technique
Breakout/Breakthrough
Technique
Pyramiding Technique
Moving Starting Point (MSP)
Technique

Best Performance
Trending Market
Trending Market
Worst Market
DTS-1 works in every market
condition

Choppy Market
Sideways Market
Reversal Market
Drawdown Period
2 months maximum

3-5 months depending how
long the choppy/sideways
market continues
Note: based on 2004-2008 data
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Market Conditions
For simplicity, I categorize the forex market into 3 kinds of market conditions:
Trending Market (Uptrend and Downtrend).
Sideways/Choppy Market.
Trend Reversal.
Usually markets move from one condition to the next: from sideways market to trending
market, from trending market to trend reversal, then back to sideways market before
continuing to trend again.
The main problem for most traders or trading systems is how to detect correctly:
1) - Is the market changing? (e.g. from sideways to trending, or from uptrend to reversal)
OR
2) - Is the market still continuing the current condition? (e.g. continuing an uptrend or still
moving sideways)
3) - How long will the current market condition continue?
How do I detect a Trending Market, Sideways Market and Reversal Market on
DTS-1?
I use 3 main indicators in PB5 and DTS-1: Simple Moving Average, Keltner Channel and
MACD on the Daily chart:
If you have PB5, you can set up your chart like below using the following indicators:
Fast Moving Average (Period=9) - Yellow Color
Slow Moving Average (Period=50) - Aqua color
Keltner Channel (EMA=50, ATR=50) - Grey color.
MACD (12,26,9) - I modify the MT4 original MACD.
You can download all indicators and the template I use below at:
Indicators and Template for DreamBuilderFx DTS-1
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I define:
- Sideways market in PB5/DTS-1: when price and both MAs (Slow MA & Fast MA) are
inside the Keltner Channel.
- Trending Market in PB5/DTS-1: when price and Fast MA (Yellow MA) are outside the
Keltner Channel.
If Fast MA (Yellow MA) is ABOVE the Keltner Channel: UPTREND Market
If Fast MA (Yellow MA) is BELOW the Keltner Channel: DOWNTREND Market
- Reversal Market in PB5/DTS-1: when price is starting to enter the Keltner Channel
followed by the Fast MA (Yellow MA), especially if there is a divergence on the MACD
(Magenta Line) before the reversal begins.
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When PB5 is in drawdown condition:
PB5 produces very good performance on trending markets, but produces drawdown when the
market is changing from trending market to trend-reversal or enters a sideways market.
The PB5 user needs to be patient when the market is in a sideways direction (e.g. period Apr -
Aug 2008, see chart below). The drawdown started on the June cycle and stayed with us until
the market started to trend in first week of August when PB5 finally returned to profit.
The important keys to using PB5 are:
Do you have enough margin to cover you when PB5 is in the process of solving the
drawdown problem ?
Do you have enough patience to wait the process out? Sometimes the sideways market
can continue for several months.
From my experience, not all PB5 clients have the patience to wait, especially if one uses the
risk setting too high.
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How can DTS-1 solve the drawdown problem better than PB5 ?
As you know PB5 uses C-cycles for trending markets and uses MSP techniques to solve the
drawdown in sideways/choppy markets.
DTS-1 adds 3 cycles (B-cycle, I-cycle and R cycle) in addition to the C-cycle and MSP
techniques on PB5.
Sideways market condition:
When DTS-1 detects there is a sideways market, DTS-1 starts 2 additional new cycles:
Breakthrough Cycle (B-Cycle); and
Inverted Cycle (I-Cycle).
Reversal market condition:
When DTS-1 detects there is a trend reversal, DTS-1 starts a new additional cycle:
Reversal Cycle (R-Cycle).
What do those 3 cycles actually do ?
Contrary to the M-cycle on PB5 which works separately from the C-cycle; B-cycle, I-cycle and
R-cycle work together to support the C-Cycle.
C-Cycle:
Initially when a C-cycle opens, it will open the trade as below:
BUY
BUY
BUY these positions are correct for a trending market,
BUY but they will cause a drawdown in a choppy market
SELL because the C-cycle will continue to add more BUY and SELL positions.
SELL
SELL
SELL

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On a trending Market the C-cycle will become:
CLOSE PROFIT
.....
BUY BUY
BUY BUY
BUY BUY
BUY BUY
BUY SELL
BUY or SELL
BUY SELL
BUY SELL
SELL SELL
SELL SELL
SELL SELL
SELL SELL
......
CLOSE PROFIT
In normal conditions the C-cycle will work most of the time. The C-cycle is enough to give us
consistent profit, especially in a high volatility market.
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What will happen when choppy and sideways markets come ?
B-Cycle, I-Cycle and R-Cycle:
When a sideways/choppy/reversal market comes, B-cycle , I-cycle or R-cycle will be activated.
B-Cycle will be activated when DTS-1 detects a Breakthrough market is happening.
I-Cycle will be activated when DTS-1 detects a Choppy market happening.
R-Cycle will be activated when DTS-1 detects a Reversal market is happening.
Note:
Some define 'breakthrough' the same as a breakout market; I define 'breakthrough' as a
breakout within a sideways area, but not a breakout outside a sideways area.
What they do is replace C-cycle positions, from:
BUY
BUY
BUY
BUY
BUY which are the wrong positions for choppy/sideways/reversal market.
SELL
SELL
SELL
SELL
SELL
into:
SELL
SELL
SELL
SELL
SELL which are the correct positions for choppy/sideways/reversal market.
BUY
BUY
BUY
BUY
BUY
The B-cycle, I-cycle and R-cycle will add and close some positions on the C-cycle, and continue
to correct those C-cycle positions until the cycle makes profit.
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During Very Choppy market conditions in which the trend is not clear:
In a very choppy market, in which DTS-1 detects several market conditions (e.g. the market is
changing all the time from trending into reversal, from reversal into sideways), DTS-1 will
open simultaneously combined cycles from C-Cycle and B-Cycle, C-Cycle and I-Cycle, or C-
Cycle and R-Cycle, and so on.
It will continue to run on two or more cycles until a clear market trend is established, then
DTS-1 will stop unnecessary cycles from running and continue with the rest until the EA closes
the cycle with profit.
Sounds easy?
YES...
Didn't I mention above that I will explain as simply as possible ?

But the programming was not so easy!
For every step, the system must maintain and recalculate all positions, calculating every
possibility that will happen if market conditions suddenly change.
As you may know, trading systems that are based on averaging, martingale or progressive
strategies will cause big drawdowns in trending markets that move against your starting
positions. In very strong markets those EAs will blow up the account.
For your information I wrote two thousand lines of code in the PB5 EA; DTS-1 is five times as
complex as PB5.
It needs several days to complete a back test for DTS-1 on EUR/USD (4 years data, test on
every tick using 90% data modeling).
Now, for those who are confused with all those cycles and don't understand what I am talking
about...
Don't worry, no more 'tech talk'... :)
Now pay attention to the next section...
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How good is DTS-1 compared to PB5 ?
Take a look at the latest sideways market in EURUSD 2008 below:
In 2008: EURUSD went sideways in Jan and Feb, started trending from March to April, then
the sideways market began again around April 24 until Aug 05 before continuing to trend in
August and September. I know many EAs on the market produced losses in August 2008.
Some EAs even blew up when the market suddenly went back to trending again, while PB5
and DTS-1 made profit and took big gains on this trending market.
When you use PB5 (Apr 1-Sep 19, 2008):

The drawdown started on a cycle in May and stayed in drawdown between June and July
until the market reverted to trending (when PB5 finally resolved the drawdown) on the first
week of Aug 2008.
I ran PB5 using Risk=3 with 2 cycles and 100 pips between the cycles.
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PB5 produced $2,789 PROFIT from $10,000 (+27,89%). The drawdown in that period
was -48%. This is considered the biggest drawdown for the past four years. That's why I
recommend Risk=1 or Risk=2 for initial capital.
The drawdown started on May 16, 2008:
and continued in June and July:
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until PB5 closed the drawdown on Aug 7, 2008:
As you see from the charts above, PB5 needed 3 months to resolve the drawdown by
taking profit in up and down markets, little by little, bit by bit.
Now we run DTS-1 on the same period (Apr 1-Sep 19, 2008):
I ran DTS-1 using Risk=3 with 4 cycles, 50 pips between cycles and I disabled the
watermark calculation.
DTS-1 produced $4,721 PROFIT from $10,000 (+47,21%).
From the equity chart above, you can see that there is no serious drawdown during the
sideways market, even if I run Risk=3. There are only 3 short term drawdown periods with
a maximum drawdown of -15.04%.
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The following charts show how DTS-1 resolves those drawdown periods faster than PB5:
From May 8 - May 20, 2008: DTS-1 resolved the drawdown in 2 weeks.

From July 14 - July 30, 2008: DTS-1 resolved the drawdown in 2 weeks.
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From Aug 18 - Sep 4, 2008: DTS-1 resolved the drawdown in 3 weeks.
As you see from the charts above, DTS-1 needed a maximum of three weeks to resolve the
drawdown in that period, compared to PB5 that needed 3 months.
Note:

Next time I will make additional back testing video available at our website.

DTS System 1 - 4 years Back Testing Results:
It's time to test DTS-1 using 4 years data (Jul 2004 - Sep 2008).
I use historical data from Alpari website which it can produce 90% data modeling.
Using DTS-1, we can finally activate all C-cycles (C1 through C4) working together to
produce more profit without the worry of causing very large drawdowns.
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First Setting:
Using Risk Setting=3; All cycles (C1-C4) Enable; with SP Distance = 50 pips between the
cycles; no watermark calculation.
Notice that DTS-1 produces a very consistent profit return (the equity grows smoothly over
time).
The Equity grows from $10,000 to $108,000 in 4 years (+980% profit return).
Maximum drawdown:-37.47% (happened 1 time in 2005) ~ compare to PB5: -55%
(Risk=3).
Maximum open positions (in 1 cycle): 172 positions.
Maximum total open positions at once (from 4 cycles): 351 positions.
Next Setting:

To reduce the drawdown and the open positions, I ran the EA with several settings below:

Note:
Not every broker allows you to open 350 positions at the same time.
I checked with FXDD, they allow up to 200 positions (which we can run on 1 or 2 cycles).
Interbank-FX and Alpari allows up to 1,000 open positions; so IBFX and Alpari would be my
1st choice for DTS-1.
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- 1 cycle only (C1) with Risk=3.
The Equity grows from $10,000 to $34,501 in 4 years (+240% profit return). The
maximum DD: -24.89%
- 2 cycles (C1 & C2) with SP Distance=100; Risk=2; No Watermark Calculation.
The Equity grows from $10,000 to $39,100 in 4 years (+290% profit return). The
maximum DD: -21.06%
- 4 cycles (C1-C4) with SP Distance = 50; Risk=1; No Watermark Calculation.
The Equity grows from $10,000 to $32,854 in 4 years (+228% profit return). The
maximum DD: -18.55%.
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- New risk management (Risk 88):

For our live account, I use a new risk management (Risk 88), the purpose of which is to
limit the drawdown to less than 30% of your initial capital. The EA starts with the Minimum
Risk Setting first, then increases the risk setting as your capital grows.

Example:
DTS starts with Risk Setting=1.
After DTS makes a profit of 20% from your initial capital it increases the Risk Setting to 2.
After you make a profit of 30% from your initial capital it increases the Risk Setting to 3.
Download statement report from LIVE account that use DTS-1:
Live Account Statement for DreamBuilderFx DTS-1
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Based on 4 years back testing on DTS-1 & PB5 (Jun 2004 - Sep 2008):
DTS - System 1
Point Break EA
C-Cycle Number
Running together

4 C-cycles (with B-cycle, I-
cycle and R-cycle running)
2 C-cycles only

SP Distance
50 pips
100 pips
Watermark
Calculation
No need for watermark
calculation.
Each C-cycle works
separately producing bigger
profit.
The watermark
calculation always
needs to be turned ON
to avoid longer
drawdown.
This results in PB5
closing all remaining
open positions as soon
as the equity increases.
Drawdown Period
2 months maximum

3-5 months depending
how long the
choppy/sideways
market continues.

Maximum Drawdown:
Risk=1
Risk=2
Risk=3

-19%
-28%
-38%

-28%
-43%
-55%

Compounded Return:
Risk=1
Risk=2
Risk=3


+230%
+520%
+980%

+170%
+230%
+350%
Note: based on 2004-2008 data
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Final Note
Although DTS-1 is better than PB5 in performance and risk factor, I will
continue to develop PB5 using C-Cycle / M-Cycle and re-release PB5 with some
improvements every 2-3 months.
The main difference is that PB5 (SE Edition) will not use B-cycle, I-cycle and R-
Cycle.
On our new membership area, on a weekly basis, I will post comments on what
DTS-1 is doing compared to the basic C-cycle used in PB5, and give my special
analysis on the EURUSD market.
By subscribing to the DTS-1 program and running PB5 on your computer, you
will learn more about how to run your PB5 efficiently.
You can run your own version of PB5, compare it with DTS-1 and learn how DTS-1
solves drawdowns faster with its strategies.