After the contract price effectively broke below the 5-day moving average, 10-day moving average, and 30-day moving average, there was a sharp drop marked by a large bearish candle. Many investors often see a large bearish or bullish candle's sharp decline or rise and immediately rush in, often buying at the highest price and selling at the lowest price. The correct trading mindset is to wait for a price pullback or rebound to the moving average area after a sharp decline and, when faced with resistance, the K-line (indicated by the circle) at that point becomes the entry point; one can short based on the 10-day moving average. The benefit of this shorting method is that, after entering the market, there is a possibility that a new round of decline may begin.
If the 30-day moving average is also trending downwards, it means that a downtrend has been established, increasing the odds of a successful entry. If it is intraday short-term trading, the position can be slightly larger.