Terminology & Concepts

• Exit Plan: Automated limit sell at $0.99 placed as soon as position opens.

• Hedged Reversal: Holding both UP and DOWN positions simultaneously when trend flips.

• Midpoint Stop Loss: Market sell triggered by midpoint price dropping to/below $0.30.

• Scale-In: Adding capital to winning positions via Market Orders (FAK).

• Underdog: Side trading below $0.50. Requires >40% confidence for entry.

• Tick Size: Minimum price increment allowed for a market (e.g., 0.01 or 0.001).

Strategy Nuances

Confidence Calculation Methods (v0.5.0+)

The bot supports two confidence calculation methods for A/B testing:

Additive Method (Default):

• Directional voting system with weighted signal aggregation

• Confidence = (winning_total - (losing_total × 0.2)) × lead_lag_bonus

• Trend agreement bonus (1.1x) when Binance and Polymarket momentum align

Bayesian Method (Alternative):

• Statistically principled probability theory using log-odds

• Starts with market prior from Polymarket orderbook

• Accumulates evidence via log-likelihood ratios: evidence = (score - 0.5) × 2 # Scale to -1 to +1 log_LR = evidence × 3.0 × quality # Quality factor (0.7-1.5x) log_odds += log_LR × weight confidence = 1 / (1 + exp(-log_odds))

• Naturally handles conflicting signals (they cancel out)

• Market prior anchors calculation to Polymarket reality

A/B Testing:

• Both methods calculated simultaneously on every trade

• Results stored in database for comparison

• Toggle via BAYESIAN_CONFIDENCE environment variable (default: NO)

• Compare win rates after 100+ trades: SELECT AVG(CASE WHEN bias='UP' THEN edge ELSE -edge END) as avg_edge, COUNT() as total, SUM(CASE WHEN result='WIN' THEN 1 ELSE 0 END) as wins, CAST(wins AS REAL) / COUNT() as win_rate FROM trades WHERE settled = 1 GROUP BY method;

Exit Plan Optimization

• Smart Exit Pricing:

• High confidence trades (≥85%): Use $0.999 exit price for maximum profit

• Standard trades: Use $0.99 exit price (configurable via EXIT_PRICE_TARGET)

• Only apply 0.999 for winning positions (UP side with price ≥ entry OR DOWN side with price ≤ entry)

• Immediate Placement: Exit plans placed immediately after position fill (no age requirement)

• Real-Time Size Validation: Exit order size validated every 1-second cycle

• Repair Logic:

• Automatic repair if exit order size mismatches database size

• Uses 0.05 share threshold to prevent infinite repair loops from exchange rounding

• Cancels incorrect order and places new one with correct size

• Adoption Logic: Discovers and adopts existing SELL orders on exchange to prevent duplicates

Scale-In Strategy (Dynamic)

• Default SCALE_IN_TIME_LEFT : 450s (7.5 minutes)

• Dynamic early entry timing based on confidence (edge ) and midpoint price:

• 12m left: edge

= 90% and price >= $0.80

• 9m left: edge

= 80% and price >= $0.70

• 7m left: edge

= 70% and price >= $0.65

• Uses Market Orders (FAK) to ensure immediate fills

• Multiplier: 1.5x (adds 150% more capital, creating 2.5x total position)

Signal Bonuses

• Trend Agreement Bonus: 1.1x multiplier if Binance and Polymarket trends align

• Lead/Lag Bonus: 1.2x bonus or 0.8x penalty based on cross-exchange consistency

Technical Requirements

• Precision: Use strict 0.0001 threshold for balance syncing

• Minimum Size: Polymarket enforces a 5.0 share minimum for limit orders

• Rounding: Use truncate_float(value, 2) for all order sizes to match exchange precision

Fees & Rebates (15-Minute Crypto Markets)

• Taker Fees: Applied ONLY to 15-minute crypto markets.

• Fee Deduction:

• BUY: Fee is taken in Tokens from the proceeds.

• SELL: Fee is taken in USDC from the proceeds.

• Effective Rates:

• Buying: Peaks at ~1.6% at $0.50 price.

• Selling: Peaks at ~3.7% at $0.30 price. Selling is generally more expensive because USDC is taken directly.

• Fee Precision: Rounded to 4 decimal places (min 0.0001 USDC). Small trades at extremes might be fee-free.

• Maker Rebates: Distributed daily in USDC to makers who provide liquidity that gets filled.

• Strategy Implications:

• Prefer Maker orders (Limit orders that add liquidity) to avoid fees and potentially earn rebates.

• Selling at low prices as a taker is particularly costly.

Common Code Patterns

Market Data

from src.trading.orders import get_midpoint, get_spread, check_liquidity

Get accurate midpoint price

price = get_midpoint(token_id)

Check if liquidity is good

if check_liquidity(token_id, size=100, warn_threshold=0.05): # Safe to trade

Order Placement

from src.trading.orders import place_batch_orders, place_market_order

Batch Orders

results = place_batch_orders(orders)

Market Sell

result = place_market_order(token_id, amount=10.0, side="SELL", order_type="FAK")

Standard Emoji Guide

Position Monitoring

• 👀 Monitoring positions

• 📈 UP side position (winning if PnL positive)

• 📉 DOWN side position (winning if PnL positive)

• 📦 Position size display

• 🧮 PnL percentage display

Position Status

• ⏰ Exit plan active (limit sell order placed)

• ⏳ Exit plan pending (waiting for conditions)

• ⏭️ Exit skipped (position below MIN_SIZE threshold)

• 📊 Scaled in position indicator

Order Lifecycle

• 🚀 Trade execution / Entry

• 🎯 Limit order placement

• ✅ Success / Order filled

• 🧹 Order cancellation

• ❌ Error/Failure

Risk Management

• 🛑 Stop loss triggered

• 🔄 Reversal / Trend flip

• ⚠️ Warning / Validation issue

• 🔧 Position repair/sync

System

• 💰 Money/Balance/Settlement

• 🌍 Geographic restriction

• 🧟 Ghost trade detection