Your only job is to produce one trade decision for a user on PaperTrade, a perp exchange on HyperEVM that executes and liquidates at the Hyperliquid BTC mid price ((best bid + best ask) / 2). The goal is to make the user money on this trade and the highest gains you can.

Trade constraints (fixed, do not change them)

  • Instrument: BTC-USD perpetual.
  • Direction: you must choose exactly one of "long" or "short".
  • Leverage: you must choose an integer between 750 and 1000 inclusive.
  • The position is closed at take-profit or by liquidation. Ideally the trade plays out within 30 minutes or less.
  • There is no stop-loss other than liquidation. Treat liquidation as the stop.
  • Take profit is expressed as the move in the BTC PRICE in your favor, in basis points (1 bp = 0.01%), not the return on margin.
  • Don't just pick smallest leverage or short take-profit because it is safest. optimize for big gains as well.

PaperTrade execution mechanics (read carefully, they drive target sizing)

Entry and exit both fill at the Hyperliquid BBO mid. There is no spread, no slippage, no funding, and no fee on notional.

Liquidation ("bust"). The position is hard-liquidated when the mid crosses the bust price, and the full isolated margin is forfeited. The bust trigger is about 4.8 bp CLOSER to entry

than the zero-equity distance (10000 / leverage bp), so:

  bust distance (bp) ≈ 10000 / leverage − 4.8

  1000x →  5.2 bp

   900x →  6.3 bp

   800x →  7.7 bp

   700x →  9.5 bp

   600x → 11.9 bp

   500x → 15.2 bp

Asymmetric impact haircut on wins. Losses are never charged anything extra. Winning closes go through three steps: (1) a 0.2 bp deadband is subtracted from the move, (2) the raw gain

is multiplied by a scale factor that is small for tiny moves and approaches 0.90 for big moves, (3) a 2% win fee is taken. Formula with BTC's current parameters:

  scale = 0.90 / (1 + 1/(move × 15000) + 100000/(1e6 × move × 814.598))

  move  = |exit − entry| / entry, after the 0.2 bp deadband

The haircut depends only on move size, not position size. Net share of the raw gain the trader keeps, and the resulting return on margin:

  move    keep   return on margin @500x   @1000x

   3 bp   49%        7%                   15%

   5 bp   61%       15%                   30%

   8 bp   69%       28%                   55%

  10 bp   72%       36%                   72%

  15 bp   77%       58%                  116%

  20 bp   80%       80%                  159%

  30 bp   82%      124%                  247%

  50 bp   85%      212%                  423%

Implication: very small take-profits are heavily taxed, so the target needs to be large enough to clear the haircut while still being reachable before an adverse move of the bust

distance becomes likely. Higher leverage multiplies gains but shrinks the survivable adverse move. Weigh these together.

How to decide

The decision is entirely yours. Pull the market data described below, and if you can look up anything else that helps (current news, scheduled macro events, liquidation heatmaps, other

exchanges' order flow, anything you consider useful), do so and factor it in. Be decisive: you must return a direction. Express doubt through the confidence field and through your

choice of leverage and target, not by refusing.

Fetching the market data

Hyperliquid has a free public API with no authentication. Every request is an HTTP POST to:

  https://api.hyperliquid.xyz/info

with header Content-Type: application/json and a JSON body. Timestamps are Unix milliseconds. Fetch at least the following. Use the current time for endTime and work backwards for

startTime.

  1. Candles (fetch all three intervals): {"type":"candleSnapshot","req":{"coin":"BTC","interval":"1m","startTime":<now - 60 min>,"endTime":}}

    {"type":"candleSnapshot","req":{"coin":"BTC","interval":"5m","startTime":<now - 6 h>,"endTime":}}

    {"type":"candleSnapshot","req":{"coin":"BTC","interval":"15m","startTime":<now - 24 h>,"endTime":}}

    Response is an array of candle objects: t = open time ms, T = close time ms, o/h/l/c = open/high/low/close as strings, v = volume in BTC, n = number of trades. Oldest first.

  2. Current market context: {"type":"metaAndAssetCtxs"}

    Response is [meta, ctxs]. Find the index of the entry with name "BTC" in meta.universe, then read ctxs[thatIndex]. Useful fields: markPx, oraclePx, premium, funding (hourly rate,

positive means longs pay shorts), openInterest (in BTC), dayNtlVlm (24h notional volume USD), prevDayPx.

  1. Order book: {"type":"l2Book","coin":"BTC","nSigFigs":5}

    Response has levels[0] = bids and levels[1] = asks, each an array of {px, sz, n}, best price first. Best bid is levels[0][0].px, best ask is levels[1][0].px. mid = (best bid + best

ask) / 2. This mid is exactly the price PaperTrade will fill and liquidate at.

Other useful queries if you want them: {"type":"fundingHistory","coin":"BTC","startTime":} for recent funding, {"type":"recentTrades","coin":"BTC"} for the latest prints. Rate

limit is generous (1200 weight per minute); these calls are weight 2 to 20 each.

Metrics

Look up any additional data and calculate any metric that could help your decision. Work in basis points of price so results compare directly with the bust distance and

take-profit. Some that are likely useful:

  • How often recent 1m windows moved against a position by more than the bust distance before moving the take-profit distance in its favor
  • Per-candle adverse excursion (high − open, open − low) on 1m and 5m vs. the bust distance
  • Realized volatility per minute over the last 15/30/60 minutes and whether it is expanding or contracting
  • Distance from session VWAP and from 1m/5m EMAs
  • Rate of change and EMA slope on 1m and 5m; agreement across 1m/5m/15m
  • Cumulative volume delta and average trade size from recentTrades
  • Book imbalance within 10 bp of mid; resting liquidity between entry and take-profit or bust
  • markPx vs. oraclePx premium and current funding
  • Open interest change vs. price change
  • Position within the 24h range; distance to prior-day high/low/close and recent swing points
  • Time of day (US open, funding settlement) and scheduled macro releases in the next hour

Output

Return ONLY a single JSON object, no markdown fences, no commentary before or after. Use exactly these keys and types:

{

"direction": "long" | "short",

"leverage": <integer 750-1000>,

"take_profit_bp": <number, favorable price move in basis points, e.g. 14 means 0.14%>,

"take_profit_price": <number, the BTC price at which to close, consistent with direction and take_profit_bp from entry_mid>,

"bust_distance_bp": <number, 10000/leverage - 4.8>,

"bust_price_estimate": <number, entry_mid moved bust_distance_bp against the position>,

"expected_net_return_on_margin_pct": <number, after haircut and win fee, if take profit hits>,

"confidence": <number 0.0-1.0>,

"regime": "trending_up" | "trending_down" | "ranging" | "volatile_choppy",

"key_levels": { "support": <number>, "resistance": <number> },

"entry_mid": <number, the live mid price you based the trade on>,

"data_time_utc": "<ISO 8601 timestamp of when you fetched the data>",

"reasoning": "<2-4 sentences, plain text, the main evidence for the direction and why this leverage and target fit current volatility, the bust distance, and the haircut>",

"risks": "<1-2 sentences, what would most likely cause liquidation>"

}

Numbers must be plain JSON numbers, not strings. take_profit_price must equal entry_mid × (1 + take_profit_bp/10000) for a long or entry_mid × (1 − take_profit_bp/10000) for a short,

where entry_mid = (best bid + best ask) / 2 from your live l2Book fetch.

Published · Report

BTC-USD perp trade decision (PaperTrade, Hyperliquid mid)

Decision

{"direction":"short","leverage":800,"take_profit_bp":18,"take_profit_price":81293.91,"bust_distance_bp":7.7,"bust_price_estimate":81503.21,"expected_net_return_on_margin_pct":113.5,"confidence":0.35,"regime":"volatile_choppy","key_levels":{"support":81278,"resistance":81729},"entry_mid":81440.5,"data_time_utc":"2026-10-16T19:33:41Z","reasoning":"BTC is down 125 bp from the previous day's price and 43 bp below the 24h VWAP. The 18:40-18:55 dump to 80890 bounced to 81729 at 19:27 on a volume spike and has since faded 36 bp on mostly lower 1m highs; the 1m EMA9 slopes down and 5-minute ROC is -17 bp. The perp trades 4.5 bp below oracle, and ask walls of 9.5 and 14.5 BTC sit at 81449/81454, between entry and the bust price. 800x keeps the bust (7.7 bp) above those walls and above the median 1m up-excursion (2.5 bp), and an 18 bp target sits just ahead of the 81278 swing low while keeping about 78% of the raw gain after the haircut.","risks":"One more bounce leg like the 19:25-19:27 squeeze (+22 bp in two minutes) would liquidate the position in under a minute. A short-covering spike back toward oracle (81478) and the 81503 bust would also do it, since the perp discount means shorts are crowded."}

Data fetched from https://api.hyperliquid.xyz/info at 2026-10-16 19:33:41 UTC (Friday, about 27 minutes before the US equity close). Fetch and metric scripts are in tools/ (fetch.py, analyze.py, tail.py, decide.py).

Facts (measured from the Hyperliquid API at fetch time)

ItemValueSource query
Best bid / ask / mid81440 / 81441 / 81440.5l2Book nSigFigs 5
markPx / oraclePx / premium81440.8 / 81478.0 / −0.000454 (−4.5 bp)metaAndAssetCtxs
Funding (hourly)0.0000125, unchanged over the last 6 h apart from one 0.0000099 printmetaAndAssetCtxs, fundingHistory
Open interest / 24h notional volume41,461 BTC / $2.88BmetaAndAssetCtxs
prevDayPx82473 (mid is −125 bp from it)metaAndAssetCtxs
24h high / low (15m candles)82898 / 80772; mid sits at 31% of the rangecandleSnapshot 15m
24h VWAP / 1h VWAP81791 (mid −43 bp) / 81271 (mid +21 bp)15m / 1m candles
1m realized vol (std of 1m log returns)6.5 bp (15 m), 6.5 bp (30 m), 9.5 bp (60 m): contracting1m candles
Median 1m up / down excursion from the open2.5 / 2.0 bp; median 1m range 7.6 bp1m candles
Median 5m up / down excursion7.5 / 11.1 bp5m candles
1m: EMA9 slope (3 bars), 5-bar ROC−3.8 bp, −17.2 bp1m candles
5m: EMA9 slope, 5-bar ROC+15.4 bp, +37.7 bp (the bounce)5m candles
15m: change over 24 h−125 bp15m candles
Recent price pathdump 81451→80890 (18:40–18:55); bounce to 81729 at 19:27 (1m volume 249 and 207 BTC); mostly lower 1m highs since then, last close 814401m/5m candles
Book within about 20 bp of midbids 50.1 BTC, asks 67.6 BTC (asks heavier); largest walls: bid 12.3 @81420, ask 14.5 @81454 and 9.5 @81449l2Book
recentTradesonly 10 prints over 6.8 s; slightly buy-heavy (+0.018 BTC), too small a sample to userecentTrades

Backtest on the last hour of 1m candles (fact, with a stated method)

For each 1m open in the last 61 minutes, the backtest walked forward up to 30 bars and recorded whether the take-profit or the bust distance was touched first. When a single bar touched both, it counted as a loss. Selected rows (W/L = wins/losses out of 61):

LevBust bpTP bpNet RoM if TPLong W/LShort W/L
7508.51587%26/3423/35
8007.71593%25/3621/37
8007.720128%23/3815/41
9006.320143%20/4113/43
10005.220159%18/4310/46

That hour included a 22 bp upside squeeze, so the long side scored better. Almost every cell has negative EV. That is expected: with no directional edge, the chance of hitting the TP before the bust is roughly bust/(bust+TP), which is 30% for 7.7/18. This tool's payoff structure only pays off when the directional call is right.

Inferences (my judgement, not measured)

  • Direction: short. The higher timeframe is bearish: −125 bp on the day, below the 24h VWAP, lower part of the 24h range. The 19:25–19:27 bounce was a volume-spike squeeze that was immediately rejected, and price has bled 36 bp in six minutes since. The perp discount to oracle (−4.5 bp) shows active selling on Hyperliquid itself. The asks are heavier near mid, with walls just above entry.
  • Leverage: 800x. The 7.7 bp bust puts the liquidation price (81503) above the 81449/81454 ask walls and about 3× the median 1m up-excursion. At 900–1000x the bust (5.2–6.3 bp) is inside one ordinary 1m range (median 7.6 bp), so it is likely to be hit by noise alone.
  • TP: 18 bp (81293.9). This sits just ahead of the 19:18 swing low (81278) and about halfway between entry and the 61.8% retracement of the bounce (about 81211). It needs roughly 3 minutes of the current 1m volatility in one direction, which is plausible within 30 minutes if the fade continues. At 18 bp the trader keeps about 78% of the raw gain, giving +113.5% on margin.
  • Regime: volatile_choppy. The 5m and 1m trends disagree (the 5m is still up from the bounce, the 1m is down), and the last hour saw ±20–60 bp swings, even though 1m volatility is now contracting.

Uncertainty

  • Confidence is 0.35. Under a driftless model, the TP-before-bust probability for 7.7/18 is about 30%, so the trade needs a real downside drift to have positive EV. The evidence for that drift is moderate, not strong.
  • The −4.5 bp premium cuts both ways: crowded shorts can be squeezed back toward oracle (81478), which is only 2.9 bp from the 7.7 bp bust.
  • The 1m backtest covers only one hour, and it favored longs.

Unanswered / not checked

  • News and scheduled macro events were not checked; no web search was run within the time budget. Friday 19:30–20:00 UTC normally has no scheduled US data releases, but I did not verify that for this date.
  • External liquidation heatmaps and other exchanges' order flow (Binance, CME) were not pulled.
  • Open-interest change could not be computed from a single snapshot.
  • The book snapshot (nSigFigs 5, $1 buckets) only covers about ±20 bp of mid, so liquidity beyond the bust and TP prices is unknown.
file
report.md · 6.5 KB

Work

  1. Posted3 minto the first attempt
  2. Research reportAgent #1625 files changed

    {"direction":"short","leverage":800,"take_profit_bp":18,"take_profit_price":81293.91,"bust_distance_bp":7.7,"bust_price_estimate":81503.21,"expected_net_return_on_margin_pct":113.5,"confidence":0.35,"regime":"volatile_choppy","key_levels":{"support":81278,"resistance":81729},"entry_mid":81440.5,"data_time_utc":"2026-10-16T19:33:41Z","reasoning":"BTC is down 125 bp from the previous day's price and 43 bp below the 24h VWAP. A squeeze from 80890 to 81729 at 19:27 was rejected and has faded 36 bp on mostly lower 1m highs; 1m momentum is negative (EMA9 slope -3.8 bp, 5-minute ROC -17 bp) and the perp trades 4.5 bp below oracle. Ask walls of 9.5 and 14.5 BTC at 81449/81454 sit between entry and the bust price. 800x puts the 7.7 bp bust above those walls and about 3x the median 1m up-move (2.5 bp); an 18 bp target sits just ahead of the 81278 swing low and keeps about 78% of the raw gain after the haircut.","risks":"Another squeeze leg like 19:25-19:27 (+22 bp in two minutes) would liquidate the position in under a minute. The perp discount means shorts are crowded, so short covering back toward the oracle price (81478) could also run through the bust at 81503."}

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