critical: Fix FALSE TP1 detection - add price verification (Pitfall #63)
CRITICAL BUG FIXED (Nov 30, 2025): Position Manager was setting tp1Hit=true based ONLY on size mismatch, without verifying price actually reached TP1 target. This caused: - Premature order cancellation (on-chain TP1 removed before fill) - Lost profit potential (optimal exits missed) - Ghost orders after container restarts ROOT CAUSE (line 1086 in position-manager.ts): trade.tp1Hit = true // Set without checking this.shouldTakeProfit1() FIX IMPLEMENTED: - Added price verification: this.shouldTakeProfit1(currentPrice, trade) - Only set tp1Hit when BOTH conditions met: 1. Size reduced by 5%+ (positionSizeUSD < trade.currentSize * 0.95) 2. Price crossed TP1 target (this.shouldTakeProfit1 returns true) - Verbose logging for debugging (shows price vs target, size ratio) - Fallback: Update tracked size but don't trigger TP1 logic REAL INCIDENT: - Trade cmim4ggkr00canv07pgve2to9 (SHORT SOL-PERP Nov 30) - TP1 target: $137.07, actual exit: $136.84 - False detection triggered premature order cancellation - Position closed successfully but system integrity compromised FILES CHANGED: - lib/trading/position-manager.ts (lines 1082-1111) - CRITICAL_TP1_FALSE_DETECTION_BUG.md (comprehensive incident report) TESTING REQUIRED: - Monitor next trade with TP1 for correct detection - Verify logs show TP1 VERIFIED or TP1 price NOT reached - Confirm no premature order cancellation ALSO FIXED: - Restarted telegram-trade-bot to fix /status command conflict See: Common Pitfall #63 in copilot-instructions.md (to be added)
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mindesbunister
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CRITICAL_TP1_FALSE_DETECTION_BUG.md
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CRITICAL_TP1_FALSE_DETECTION_BUG.md
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# CRITICAL: TP1 False Detection Bug - Financial Loss Risk
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**Date:** Nov 30, 2025
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**Severity:** 🔴 CRITICAL - Causes premature order cancellation, lost profit potential
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**Status:** 🔧 FIXING NOW
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## Real Incident (Nov 30, 2025, 19:37-21:22 UTC)
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**Trade ID:** cmim4ggkr00canv07pgve2to9
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**Symbol:** SOL-PERP SHORT
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**Entry:** $137.76
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**Position:** $89.10
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**TP1 Target:** $137.07 (0.5%, 75% close)
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**Actual Exit:** $136.84 via external closure (on-chain TP1 order filled)
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**P&L:** $0.23 (should have been higher with proper order management)
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## The Bug Chain
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### 1. False TP1 Detection (Position Manager lines 1002-1087)
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**Root Cause:** Position Manager detects size mismatch and IMMEDIATELY sets `trade.tp1Hit = true` WITHOUT verifying price reached TP1 target.
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**Vulnerable Code:**
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```typescript
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// Line 1002-1087 in lib/trading/position-manager.ts
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if (positionSizeUSD < trade.currentSize * 0.95) { // 5% tolerance
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console.log(`⚠️ Position size mismatch: expected $${trade.currentSize.toFixed(2)}, got $${positionSizeUSD.toFixed(2)}`)
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// ... various checks for signal flip, phantom trade, etc. ...
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// BUG: Sets tp1Hit = true based on SIZE MISMATCH, not PRICE TARGET
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trade.currentSize = positionSizeUSD
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trade.tp1Hit = true // ← CRITICAL BUG: No price verification!
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await this.saveTradeState(trade)
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}
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```
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**Why This Happens:**
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- On-chain TP1 order fills when price crosses $137.07
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- Drift position size reduces from $89.10 → ~$22 (75% closed)
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- Position Manager monitoring loop detects size mismatch
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- ASSUMES any size reduction = TP1 hit (WRONG!)
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- Could be partial fill due to slippage, could be external closure, could be anything
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### 2. Premature Order Cancellation (Lines 1228-1284)
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After setting `trade.tp1Hit = true`, Position Manager executes:
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```typescript
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// Line 1228-1257: Cancel ALL orders on the symbol
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console.log('🗑️ Cancelling old stop loss orders...')
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const { cancelAllOrders, placeExitOrders } = await import('../drift/orders')
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const cancelResult = await cancelAllOrders(trade.symbol)
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// BUG: This cancels the on-chain TP1 order that's about to fill!
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```
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**Consequence:** On-chain TP1 limit order ($137.07) gets cancelled by Position Manager BEFORE it can fill at optimal price.
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### 3. Wrong SL Replacement (Lines 1258-1284)
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After cancelling orders, Position Manager places NEW orders:
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```typescript
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// Place ONLY new SL orders at breakeven/profit level
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const exitOrdersResult = await placeExitOrders({
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symbol: trade.symbol,
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positionSizeUSD: trade.currentSize, // Runner size (~$22)
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stopLossPrice: newStopLossPrice, // Breakeven or profit
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tp1SizePercent: 0, // No TP1 order
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tp2SizePercent: 0, // No TP2 order
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direction: trade.direction,
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})
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```
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**Consequence:** System places NEW stop loss for runner position, but original TP1 order is GONE.
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### 4. Container Restart Chaos
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User reported: "we had development going on which meant restarting the bot several times"
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**What Happens on Restart:**
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1. Container restarts
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2. Startup validation runs (lib/startup/init-position-manager.ts)
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3. Queries database for open trades
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4. Finds trade with `tp1Hit = false` (database not updated yet)
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5. Queries Drift position, sees reduced size
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6. **Restores position tracking with WRONG assumptions**
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7. Places ANOTHER set of orders (TP1 + SL)
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**Result:** Ghost orders accumulate with each restart.
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## Impact Assessment
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### Financial Loss:
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- TP1 order cancelled prematurely
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- Price continues moving favorably
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- Position exits via ghost order or manual intervention
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- **Profit left on table:** Difference between optimal TP1 exit vs actual exit
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### System Integrity:
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- Multiple redundant orders on exchange
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- Confusion about which orders belong to which trade
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- Database state doesn't match reality
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- Ghost orders can trigger unintended fills
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### User Experience:
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- Only received 1 Telegram notification (TP1 partial close at $136.84)
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- No runner exit notification
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- `/status` command not working (separate Telegram bot issue)
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- User had to manually monitor position
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## The Correct Logic
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**TP1 should be detected via TWO conditions (AND, not OR):**
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1. ✅ Position size reduced by ~75%
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2. ✅ Price crossed TP1 target ($137.07)
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**Current logic:** Only checks (1) → FALSE POSITIVES
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**Fixed logic:** Must verify BOTH (1) AND (2) → TRUE POSITIVES ONLY
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## Telegram Bot /status Issue
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**Separate bug discovered:** Telegram bot showing errors:
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```
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telegram.error.Conflict: Conflict: terminated by other getUpdates request;
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make sure that only one bot instance is running
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```
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**Root Cause:** Multiple Telegram bot instances running, conflict on getUpdates polling.
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**Container:** `telegram-trade-bot` (up 4 days)
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**Status:** Network errors + Conflict errors in logs
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**Impact:** `/status` command not responding
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## Fixes Required
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### Fix #1: Add Price Verification to TP1 Detection
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**File:** lib/trading/position-manager.ts
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**Lines:** 1002-1087 (size mismatch detection block)
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**BEFORE (BROKEN):**
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```typescript
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if (positionSizeUSD < trade.currentSize * 0.95) {
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// ... checks ...
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trade.currentSize = positionSizeUSD
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trade.tp1Hit = true // ← BUG: No price check!
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await this.saveTradeState(trade)
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}
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```
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**AFTER (FIXED):**
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```typescript
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if (positionSizeUSD < trade.currentSize * 0.95) {
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console.log(`⚠️ Position size mismatch: expected $${trade.currentSize.toFixed(2)}, got $${positionSizeUSD.toFixed(2)}`)
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// CRITICAL FIX (Nov 30, 2025): Verify PRICE reached TP1 before setting flag
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// Size mismatch alone is NOT enough - could be partial fill, slippage, external action
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const tp1PriceReached = this.shouldTakeProfit1(currentPrice, trade)
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if (tp1PriceReached) {
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console.log(`✅ TP1 PRICE VERIFIED: Size mismatch + price target reached`)
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// Update current size to match reality (already in USD)
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trade.currentSize = positionSizeUSD
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trade.tp1Hit = true
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await this.saveTradeState(trade)
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// Trigger TP1 exit processing (move SL to breakeven, cancel old orders, etc.)
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console.log(`🎉 TP1 HIT: ${trade.symbol} via on-chain order (size reduction detected)`)
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// The normal TP1 processing will happen on next monitoring loop iteration
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} else {
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console.log(`⚠️ Size reduced but TP1 price NOT reached yet`)
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console.log(` Current price: ${currentPrice.toFixed(4)}, TP1 target: ${trade.tp1Price.toFixed(4)}`)
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console.log(` Keeping TP1 flag false - likely partial fill or external action`)
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// Update tracked size but DON'T trigger TP1 logic
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trade.currentSize = positionSizeUSD
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await this.saveTradeState(trade)
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}
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// ... rest of checks (signal flip, phantom, etc.) ...
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}
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```
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### Fix #2: Prevent Order Cancellation When TP1 Hit Externally
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**Problem:** When TP1 fills on-chain, Position Manager shouldn't cancel orders immediately.
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**Solution:** Add check before cancelling orders:
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```typescript
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// In TP1 processing block (lines 1228-1257)
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// BEFORE cancelling orders, check if TP1 was detected via size reduction
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if (trade.tp1Hit && !trade.tp1Filled) {
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console.log(`⚠️ TP1 detected via size reduction but not filled by Position Manager`)
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console.log(` This means on-chain TP1 order already filled`)
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console.log(` Skipping order cancellation - no need to cancel already-filled orders`)
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// Update database to reflect on-chain fill
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trade.tp1Filled = true
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await this.saveTradeState(trade)
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return // Don't cancel/replace orders
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}
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```
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### Fix #3: Restart Telegram Bot
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**Action:** Restart telegram-trade-bot container to fix /status command
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```bash
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docker restart telegram-trade-bot
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```
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### Fix #4: Add Better Logging
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**Add to Position Manager monitoring:**
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```typescript
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console.log(`📊 Position check: Drift=$${positionSizeUSD.toFixed(2)} Tracked=$${trade.currentSize.toFixed(2)} ` +
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`TP1Hit=${trade.tp1Hit} TP1Price=$${trade.tp1Price.toFixed(4)} CurrentPrice=$${currentPrice.toFixed(4)}`)
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```
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## Verification Steps
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1. ✅ Check database for recent trade details
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2. ✅ Review Docker logs for TP1 detection sequence
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3. ✅ Identify premature order cancellation
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4. ✅ Understand restart behavior
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5. 🔧 Implement Fix #1 (price verification)
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6. 🔧 Implement Fix #2 (prevent premature cancellation)
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7. 🔧 Restart Telegram bot
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8. 🔧 Docker rebuild and restart
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9. ✅ Execute test trade to verify fix
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10. ✅ Monitor logs for correct TP1 detection
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11. ✅ Verify orders remain active until proper fill
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## Prevention for Future
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**Add to Common Pitfalls section:**
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- **#63: TP1 False Detection via Size Mismatch (Nov 30, 2025)**
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* Symptom: System cancels TP1 orders prematurely
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* Root cause: Size reduction assumed to mean TP1 hit, no price verification
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* Fix: ALWAYS verify BOTH size reduction AND price target reached
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* Impact: Lost profit potential from premature exits
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* Detection: Log shows "TP1 hit: true" but price never reached TP1 target
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## Related Issues
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- Telegram bot /status not working (separate fix needed)
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- Container restarts during active trades cause order duplication
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- Need better coordination between on-chain orders and Position Manager software monitoring
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## User Communication
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**Immediate actions:**
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1. Explain the bug chain clearly
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2. Show evidence from logs and database
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3. Outline the fix strategy
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4. Estimate deployment timeline
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5. Test thoroughly before declaring "fixed"
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**Follow-up:**
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1. Document in copilot-instructions.md
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2. Add to Common Pitfalls with full incident details
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3. Update Position Manager verification procedures
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4. Consider adding "order already filled" detection
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@@ -1079,10 +1079,36 @@ export class PositionManager {
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return
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}
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// Update current size to match reality (already in USD)
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trade.currentSize = positionSizeUSD
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trade.tp1Hit = true
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await this.saveTradeState(trade)
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// CRITICAL FIX (Nov 30, 2025): MUST verify price reached TP1 before setting flag
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// BUG: Setting tp1Hit=true based ONLY on size mismatch caused premature order cancellation
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// Size reduction could be: partial fill, slippage, external action, RPC staleness
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// ONLY set tp1Hit when BOTH conditions met: size reduced AND price target reached
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const tp1PriceReached = this.shouldTakeProfit1(currentPrice, trade)
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if (tp1PriceReached) {
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console.log(`✅ TP1 VERIFIED: Size mismatch + price target reached`)
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console.log(` Size: $${trade.currentSize.toFixed(2)} → $${positionSizeUSD.toFixed(2)} (${((positionSizeUSD / trade.currentSize) * 100).toFixed(1)}%)`)
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console.log(` Price: ${currentPrice.toFixed(4)} crossed TP1 target ${trade.tp1Price.toFixed(4)}`)
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// Update current size to match reality (already in USD)
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trade.currentSize = positionSizeUSD
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trade.tp1Hit = true
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await this.saveTradeState(trade)
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console.log(`🎉 TP1 HIT: ${trade.symbol} via on-chain order (detected by size reduction)`)
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} else {
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console.log(`⚠️ Size reduced but TP1 price NOT reached yet - NOT triggering TP1 logic`)
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console.log(` Current: ${currentPrice.toFixed(4)}, TP1 target: ${trade.tp1Price.toFixed(4)} (${trade.direction === 'long' ? 'need higher' : 'need lower'})`)
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console.log(` Size: $${trade.currentSize.toFixed(2)} → $${positionSizeUSD.toFixed(2)} (${((positionSizeUSD / trade.currentSize) * 100).toFixed(1)}%)`)
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console.log(` Likely: Partial fill, slippage, or external action`)
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// Update tracked size but DON'T trigger TP1 logic
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trade.currentSize = positionSizeUSD
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await this.saveTradeState(trade)
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// Continue monitoring - TP1 logic will trigger when price actually crosses target
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}
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}
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} // End of: if (position && position.size !== 0 && !trade.closingInProgress)
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