1st point about lot%
At lot 4% you have 4x less wiggle room than at 1%. So our tolerance for pain will be minimal here, ie any big move will wipe us out. Our 'black swan' events are random, in 2008 for example we see more volatility in EURCHF, and get about 4 or 5 of these events throughout the year. 2009 is great and 2010 conditions are similar if not more flat than 2009.
The only way to really find out is to test test test test.
Backtest wise price channel stop doesn't work too well, at least with the settings I've tried. Even if you filter out 2 bad trades to 1 good trade ratio (2:1) or better., the fact that u filter out a good trade could increase our holding time which does two things, increases our risk and causes opportunity loss.
The idea here is to keep everything simple and elegant. I recommend watching a documentary called 'The Secret Life of Chaos', its on youtube. I came up with this after watching it....