server {
    listen 80;
    server_name localhost;

    # Document root
    root /usr/share/nginx/html;
    index index.html;

    # Handle SPA routing
    location / {
        try_files $uri $uri/ /index.html;
    }

    # Proxy API requests to the backend
    location /api/ {
        proxy_pass http://backend:4000;
        proxy_http_version 1.1;
        proxy_set_header Upgrade $http_upgrade;
        proxy_set_header Connection 'upgrade';
        proxy_set_header Host $host;
        proxy_cache_bypass $http_upgrade;
    }

    # Static asset caching
    location ~* \.(js|css|png|jpg|jpeg|gif|svg|ico)$ {
        expires 30d;
        add_header Cache-Control "public, no-transform";
    }

    # Enable gzip compression
    gzip on;
    gzip_vary on;
    gzip_min_length 10240;
    gzip_proxied expired no-cache no-store private auth;
    gzip_types text/plain text/css text/xml text/javascript application/x-javascript application/xml;
    gzip_disable "MSIE [1-6]\.";
}