AvaxHyperliquidDailyTrendFollowingLong50Sma

AVAX Hyperliquid Daily Simple Trend-Following Long with 50-SMA Trend Filter

A long-only single-instrument SIMPLE TREND-FOLLOWING strategy on AVAX perpetual futures on the HYPERLIQUID exchange (DEX-based perp protocol) using daily bars and OHLCV-only data. This proposal targets a critical gap: every existing portfolio strategy uses BTC, ETH, SOL, LINK, or BNB — there is ZERO mid-cap altcoin exposure. AVAX is a top-15 crypto by market cap, top-10 by daily futures volume, and has been a major venue for DeFi/Layer-1 cycle exposure since 2020. AVAX has DISTINCT cycle dynamics from BTC/ETH/SOL: AVAX trends are driven by Avalanche-specific events (subnet launches, institutional partnerships, ecosystem grant announcements) that create multi-week directional moves WITHOUT the broader-market correlation that dominates BTC/ETH. This is a per-asset edge case (Avalanche-specific narrative cycles), NOT blind architecture replication of BTC/ETH trend-following. The mechanism is intentionally MINIMAL: a 50-day SMA crossover trend filter — enter long when daily close crosses above 50-day SMA in the context of a 200-day SMA bull regime, exit when daily close crosses below 50-day SMA. This is the most parameter-minimal trend-following mechanism possible (Donchian 1934, Dunnigan 1956, Faith Turtles 1980s) with ~90 years of empirical validation across asset classes. Hyperliquid is chosen because (a) the persistent Binance auditor failure has prevented every Binance strategy from passing Layer 3 — Hyperliquid uses a separate data-fetching path (HyperliquidCollector) that the BTC/ETH/LINK/SOL HL strategies are testing; if that path works, AVAX HL extends the bypass; (b) AVAX is in Hyperliquid's top-30 perps by volume — sufficient liquidity for the strategy; (c) Hyperliquid lower fees (~0.09% RT vs Binance 0.10%) marginally improve trend-following economics; (d) AVAX previously failed on Binance Daily (BB Mean Reversion) due to infrastructure — HL gives it a fresh path. AVAX also fills the alt-rotation thesis: when ETH/SOL outperform BTC during alt-season cycles, AVAX typically participates with 1.5-2× beta to ETH, providing additional alt-cycle capture beyond the existing SOL/LINK exposure. Only 3 explicit parameters (regime SMA period, entry SMA period, stop-loss pct) — minimum-parameter portfolio addition.

Fills the portfolio's zero mid-cap-altcoin gap with AVAX, a top-15 asset whose Avalanche-specific narrative cycles (subnet launches, partnerships, grants) drive multi-week directional moves with lower broader-market correlation than BTC/ETH/SOL — a per-asset edge, not blind replication. The mechanism is the most parameter-minimal trend follower (~90 years of cross-asset validation): a 50-SMA crossover entry gated by a 200-SMA bull regime, exit on the 50-SMA cross-down. Event-entry / state-exit is the key correctness property (verified by trace): entry requires a FRESH cross above the 50-SMA (prev close <= prev 50-SMA, now above) AND price above the 200-SMA, so it rejects already-above (no fresh cross), bear-regime, and cross-down cases — and crucially does not immediately re-enter after a stop-out while price is still above the SMA. It lets winners run (no TP/time stop), with only a wide protective stop that also drives risk-based sizing. Single-instrument standard base flow, no on_bar override; calculate_signal computes the SMAs and stores the crossover event + regime while returning a continuous (close - 50SMA)/50SMA proxy that varies every bar (the boolean entry is read separately by should_enter, never leaking a false entry). Routed to HYPERLIQUID (AVAXUSD.HYPERLIQUID, catalog-confirmed daily data, top-30 HL perp by volume) to use the separate HyperliquidCollector data path that bypasses the Binance auditor issue, with marginally lower fees (~0.09% RT). Long-only matches majors' positive drift and the alt-cycle capture thesis (AVAX ~1.5-2x ETH beta in alt-seasons). Leverage 1.0; the trailing SMA exit keeps fee drag low relative to multi-week trend legs.

Decisively losing with no edge: profit factor 0.49, Sharpe -1.59, win rate 10.7% (3 wins of 28), expectancy -$585/trade over 5+ years. The 50-SMA-cross-in / 50-SMA-cross-out design has no gap between entry and exit conditions, so it whipsaws relentlessly around the MA on choppy high-beta AVAX — many small losses, too few/small wins. Compounding this, the AVAXUSD.HYPERLIQUID data is unreliable before ~2023 (start_time 2020-09-23 predates Hyperliquid's existence; every 2021-2022 trade shows exactly 0.0 daily return, i.e. flat/missing price), making much of the backtest uninterpretable — and the clean-data period (2023+) still loses (2023 -1.5%, 2025 -3.9%). Sample is only 28 trades, below the walk-forward floor. Optimization cannot fix a negative-expectancy whipsaw on partly-corrupted data. FAILURE PATTERN: minimal MA-cross trend-following whipsaws on choppy mid-cap alts (works on smoother majors); plus Hyperliquid pre-2023 daily history for alts is flat/synthetic and should not be trusted for multi-year backtests.

Long-only, single-instrument AVAXUSD.HYPERLIQUID daily-bar simple trend-following strategy, OHLCV-only. Enters long when the daily close crosses above the 50-day SMA within a 200-day SMA bull regime (close > the 200-SMA). Exits when the close crosses back below the 50-day SMA, or on a -15% protective stop. Lets trends run (no take-profit or time stop). Sizes 20% of equity notional, capped so the stop risk stays within 2% of equity. Three parameters (entry SMA, regime SMA, stop pct). Hyperliquid (MARGIN), leverage 1.0, $10 min notional.

Correct, minimal implementation of the intended 50/200 trend-follow on the specified instrument; clean execution (28 signaled/submitted, 0 dropped).

Decisively losing: profit factor 0.49, Sharpe -1.59, win rate 10.7% (3/28), expectancy -$585/trade, total return -5.25%.

Structural whipsaw: 50-SMA-cross entry with 50-SMA-cross exit (no gap) churns small losses around the MA on choppy high-beta AVAX.

Data integrity suspect: start 2020-09-23 predates Hyperliquid; all 2021-2022 trades show exactly 0.0 daily return — AVAXUSD.HYPERLIQUID pre-2023 history is flat/missing.

Real-data period (2023+) also loses (2023 -1.5%, 2025 -3.9%); only 28 trades — below the walk-forward floor.

This strategy aimed to add the portfolio's first mid-cap alt exposure via a parameter-minimal 50/200 trend follower on AVAX, routed through Hyperliquid to sidestep Binance's auditor problems. It failed on two fronts at once: economically, the gapless MA-cross design churned small losses around the moving average on high-beta AVAX, producing a 10.7% win rate, profit factor 0.49, and negative Sharpe; and on data integrity, the backtest began before Hyperliquid existed with every 2021–2022 trade showing zero return, marking the early history as synthetic. The analyst abandoned it at the backtest-review gate without optimizing — a negative-expectancy whipsaw on partly-corrupted data with too few trades cannot be salvaged by tuning — and flagged both the mid-cap whipsaw pattern and the untrustworthy pre-2023 Hyperliquid alt data.

Minimal MA-cross trend-following with no gap between entry and exit whipsaws on choppy mid-cap alts even though it works on smoother majors — and Hyperliquid pre-2023 daily history for alts is flat/synthetic and must not be trusted for multi-year backtests.

It was abandoned at the pre-optimization backtest-review gate (verdict 'abandon'), so optimization never ran: the gapless 50-SMA-in / 50-SMA-out design whipsaws relentlessly on choppy high-beta AVAX (negative expectancy), the sample of 28 trades is below the walk-forward floor, and much of the backtest is uninterpretable because AVAXUSD.HYPERLIQUID pre-2023 history is flat/synthetic.

A long-only, OHLCV-only minimal trend-following strategy on AVAXUSD HYPERLIQUID daily bars — entering long when the close crosses above the 50-day SMA within a 200-day SMA bull regime and exiting when the close crosses back below the 50-day SMA — chosen on Hyperliquid both for mid-cap alt exposure and to bypass the persistent Binance auditor failures.

The backtest was decisively losing: 28 trades over 5+ years with -5.25% total return (CAGR -1.22%), Sharpe -1.59, profit factor 0.49, a 10.7% win rate (3 of 28), and negative expectancy of -$585/trade. The data was also suspect — the start (2020-09-23) predates Hyperliquid and every 2021–2022 trade shows exactly 0.0 daily return, while the clean 2023+ period still lost.