# AI Agent Instructions for Trading Bot v4

## Architecture Overview

**Type:** Autonomous cryptocurrency trading bot with Next.js 15 frontend + Solana/Drift Protocol backend

**Data Flow:** TradingView → n8n webhook → Next.js API → Drift Protocol (Solana DEX) → Real-time monitoring → Auto-exit

**Key Design Principle:** Dual-layer redundancy - every trade has both on-chain orders (Drift) AND software monitoring (Position Manager) as backup.

## Critical Components

### 1. Position Manager (`lib/trading/position-manager.ts`)
**Purpose:** Software-based monitoring loop that checks prices every 2 seconds and closes positions via market orders

**Singleton pattern:** Always use `getPositionManager()` - never instantiate directly
```typescript
const positionManager = getPositionManager()
await positionManager.addTrade(activeTrade)
```

**Key behaviors:**
- Tracks `ActiveTrade` objects in a Map
- Dynamic SL adjustments: Moves to breakeven at +0.5%, locks profit at +1.2%
- Closes positions via `closePosition()` market orders when targets hit
- Acts as backup if on-chain orders don't fill

### 2. Drift Client (`lib/drift/client.ts`)
**Purpose:** Solana/Drift Protocol SDK wrapper for order execution

**Singleton pattern:** Use `initializeDriftService()` and `getDriftService()` - maintains single connection
```typescript
const driftService = await initializeDriftService()
const health = await driftService.getAccountHealth()
```

**Wallet handling:** Supports both JSON array `[91,24,...]` and base58 string formats from Phantom wallet

### 3. Order Placement (`lib/drift/orders.ts`)
**Critical function:** `placeExitOrders()` - places TP/SL orders on-chain

**Dual Stop System** (USE_DUAL_STOPS=true):
```typescript
// Soft stop: TRIGGER_LIMIT at -1.5% (avoids wicks)
// Hard stop: TRIGGER_MARKET at -2.5% (guarantees exit)
```

**Order types:**
- Entry: MARKET (immediate execution)
- TP1/TP2: LIMIT reduce-only orders
- Soft SL: TRIGGER_LIMIT reduce-only
- Hard SL: TRIGGER_MARKET reduce-only

### 4. Database (`lib/database/trades.ts` + `prisma/schema.prisma`)
**Purpose:** PostgreSQL via Prisma ORM for trade history and analytics

**Models:** Trade, PriceUpdate, SystemEvent, DailyStats

**Singleton pattern:** Use `getPrismaClient()` - never instantiate PrismaClient directly

**Key functions:**
- `createTrade()` - Save trade after execution (includes dual stop TX signatures)
- `updateTradeExit()` - Record exit with P&L
- `addPriceUpdate()` - Track price movements (called by Position Manager)
- `getTradeStats()` - Win rate, profit factor, avg win/loss

## Configuration System

**Three-layer merge:**
1. `DEFAULT_TRADING_CONFIG` (config/trading.ts)
2. Environment variables (.env) via `getConfigFromEnv()`
3. Runtime overrides via `getMergedConfig(overrides)`

**Always use:** `getMergedConfig()` to get final config - never read env vars directly in business logic

**Symbol normalization:** TradingView sends "SOLUSDT" → must convert to "SOL-PERP" for Drift
```typescript
const driftSymbol = normalizeTradingViewSymbol(body.symbol)
```

## API Endpoints Architecture

**Authentication:** All `/api/trading/*` endpoints (except `/test`) require `Authorization: Bearer API_SECRET_KEY`

**Pattern:** Each endpoint follows same flow:
1. Auth check
2. Get config via `getMergedConfig()`
3. Initialize Drift service
4. Check account health
5. Execute operation
6. Save to database
7. Add to Position Manager if applicable

**Key endpoints:**
- `/api/trading/execute` - Main entry point from n8n (production)
- `/api/trading/test` - Test trades from settings UI (no auth required)
- `/api/trading/close` - Manual position closing
- `/api/trading/positions` - Query open positions
- `/api/settings` - Get/update config (writes to .env file)

## Critical Workflows

### Execute Trade (Production)
```
n8n webhook → /api/trading/execute
  ↓ normalize symbol (SOLUSDT → SOL-PERP)
  ↓ getMergedConfig()
  ↓ openPosition() [MARKET order]
  ↓ calculate dual stop prices if enabled
  ↓ placeExitOrders() [on-chain TP/SL orders]
  ↓ createTrade() [save to database]
  ↓ positionManager.addTrade() [start monitoring]
```

### Position Monitoring Loop
```
Position Manager every 2s:
  ↓ getPythPriceMonitor().getLatestPrice()
  ↓ Calculate current P&L
  ↓ Check TP1 hit → closePosition(75%)
  ↓ Check TP2 hit → closePosition(100%)
  ↓ Check SL hit → closePosition(100%)
  ↓ Check dynamic adjustments (breakeven, profit lock)
  ↓ addPriceUpdate() [save to database]
```

### Settings Update
```
Web UI → /api/settings POST
  ↓ Validate new settings
  ↓ Write to .env file using string replacement
  ↓ Return success
  ↓ User clicks "Restart Bot" → /api/restart
  ↓ Creates /tmp/trading-bot-restart.flag
  ↓ watch-restart.sh detects flag
  ↓ Executes: docker restart trading-bot-v4
```

## Docker Context

**Multi-stage build:** deps → builder → runner (Node 20 Alpine)

**Critical Dockerfile steps:**
1. Install deps with `npm install --production`
2. Copy source and `npx prisma generate` (MUST happen before build)
3. `npm run build` (Next.js standalone output)
4. Runner stage copies standalone + static + node_modules + Prisma client

**Container networking:**
- External: `trading-bot-v4` on port 3001
- Internal: Next.js on port 3000
- Database: `trading-bot-postgres` on 172.28.0.0/16 network

**DATABASE_URL caveat:** Use `trading-bot-postgres` (container name) in .env for runtime, but `localhost:5432` for Prisma CLI migrations from host

## Project-Specific Patterns

### 1. Singleton Services
Never create multiple instances - always use getter functions:
```typescript
const driftService = await initializeDriftService() // NOT: new DriftService()
const positionManager = getPositionManager()        // NOT: new PositionManager()
const prisma = getPrismaClient()                     // NOT: new PrismaClient()
```

### 2. Price Calculations
Direction matters for long vs short:
```typescript
function calculatePrice(entry: number, percent: number, direction: 'long' | 'short') {
  if (direction === 'long') {
    return entry * (1 + percent / 100)  // Long: +1% = higher price
  } else {
    return entry * (1 - percent / 100)  // Short: +1% = lower price
  }
}
```

### 3. Error Handling
Database failures should not fail trades - always wrap in try/catch:
```typescript
try {
  await createTrade(params)
  console.log('💾 Trade saved to database')
} catch (dbError) {
  console.error('❌ Failed to save trade:', dbError)
  // Don't fail the trade if database save fails
}
```

### 4. Reduce-Only Orders
All exit orders MUST be reduce-only (can only close, not open positions):
```typescript
const orderParams = {
  reduceOnly: true,  // CRITICAL for TP/SL orders
  // ... other params
}
```

## Testing Commands

```bash
# Local development
npm run dev

# Build production
npm run build && npm start

# Docker build and restart
docker compose build trading-bot
docker compose up -d --force-recreate trading-bot
docker logs -f trading-bot-v4

# Database operations
npx prisma generate                                    # Generate client
DATABASE_URL="postgresql://...@localhost:5432/..." npx prisma migrate dev
docker exec trading-bot-postgres psql -U postgres -d trading_bot_v4 -c "\dt"

# Test trade from UI
# Go to http://localhost:3001/settings
# Click "Test LONG" or "Test SHORT"
```

## Common Pitfalls

1. **Prisma not generated in Docker:** Must run `npx prisma generate` in Dockerfile BEFORE `npm run build`

2. **Wrong DATABASE_URL:** Container runtime needs `trading-bot-postgres`, Prisma CLI from host needs `localhost:5432`

3. **Symbol format mismatch:** Always normalize with `normalizeTradingViewSymbol()` before calling Drift

4. **Missing reduce-only flag:** Exit orders without `reduceOnly: true` can accidentally open new positions

5. **Singleton violations:** Creating multiple DriftClient or Position Manager instances causes connection/state issues

6. **Type errors with Prisma:** The Trade type from Prisma is only available AFTER `npx prisma generate` - use explicit types or `// @ts-ignore` carefully

## File Conventions

- **API routes:** `app/api/[feature]/[action]/route.ts` (Next.js 15 App Router)
- **Services:** `lib/[service]/[module].ts` (drift, pyth, trading, database)
- **Config:** Single source in `config/trading.ts` with env merging
- **Types:** Define interfaces in same file as implementation (not separate types directory)
- **Console logs:** Use emojis for visual scanning: 🎯 🚀 ✅ ❌ 💰 📊 🛡️

## When Making Changes

1. **Adding new config:** Update DEFAULT_TRADING_CONFIG + getConfigFromEnv() + .env file
2. **Adding database fields:** Update prisma/schema.prisma → migrate → regenerate client → rebuild Docker
3. **Changing order logic:** Test with DRY_RUN=true first, use small position sizes ($10)
4. **API endpoint changes:** Update both endpoint + corresponding n8n workflow JSON
5. **Docker changes:** Rebuild with `docker compose build trading-bot` then restart container

## Integration Points

- **n8n:** Expects exact response format from `/api/trading/execute` (see n8n-complete-workflow.json)
- **Drift Protocol:** Uses SDK v2.75.0 - check docs at docs.drift.trade for API changes
- **Pyth Network:** WebSocket + HTTP fallback for price feeds (handles reconnection)
- **PostgreSQL:** Version 16-alpine, must be running before bot starts

---

**Key Mental Model:** Think of this as two parallel systems (on-chain orders + software monitoring) working together. The Position Manager is the "backup brain" that constantly watches and acts if on-chain orders fail. Both write to the same database for complete trade history.