Vietnam Insight

▶ The market experienced a trading session of narrow range on Thursday. The index only fluctuated mildly around the reference price and closed with a mild increase. The transaction value was approximately the same as yesterday's session, indicating that investors' apprehension remained as the index was approaching the upper resistance zone. Foreign investors continued their net selling streak although the net selling value dropped slightly.

▶ At the end of the trading session, the VN-Index increased by 3.44 points (+0.27%), reaching 1,270.35 points; the HNX-Index increased by 0.2 points (+0.09%), reaching 229.32 points. Market liquidity only reached 13.37 trillion VND, which was equivalent to about 619.24 million shares being traded. Foreign investors continued to net sell 233 billion VND, mainly focusing on VNM, VPB and MWG.

▶ Technical perspective: VN-Index continued to trade sideways with liquidity remaining at a low level. In the short-term trend, VN-Index is likely to establish an accumulation zone with the oscillation amplitude narrowing. MACD still maintains a positive signal, showing that the trend has not turned negative yet. The current narrow sideways zone will act as an absorption zone for selling force around the resistance area 1,275 - 1,280 before a clear signal of cash flow’s return appears.

In a positive scenario, VN-Index will establish a green candle with a wide body in the following sessions, confirming the control of the buying side and move towards retesting the old peak of 1,300. In a more negative scenario, VN-Index will continue to decrease sharply with a wide body candle, losing the uptrend on both daily and weekly charts; then the next support will be the 1,180 - 1,200 point zone. 

Strategy: The market is following the sideways trend. For short-term trading strategy, investors should consider disbursing around the 1,240 point area and gradually taking profits when the index approachs 1,300 points. With a buy-and-hold strategy, investors should disburse strongly when the VN-Index breaks out and successfully upholds the 1,300 point area.