The market conditions on the day before this contract were volatile, with a small upward trend at the close. In actual trading, it is advisable to observe more and act less during the first 15 minutes after the market opens and the last 10 minutes before the market closes. One should not blindly follow the market trends that suddenly rise or fall just a few minutes before the close, as these rapid changes do not reflect the true market conditions. Often, they are indications of the bulls or bears locking in profits right before the close.
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If there are two rapid K-lines before the close on the previous day, then on the opening of the next day, there will likely be a big bearish candle (at the circled part). If investors blindly enter and chase the bullish trend before the previous day's close, they can easily get trapped. After a big bearish candle drops sharply at the opening of the day, the rebound is usually not substantial, and the price may only rebound to the middle band of the Bollinger Bands before turning down again. When the price breaks below the previous low, it can be used as a basis for entering a short position.
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