Vietnam Insight

▶ The trading week gloomly opened in redness. Selling pressure gradually increased in the afternoon session, especially for the stocks relevant to Vingroup which had experienced magnificent increase in recent times, with the couple VHM and VIC contributing more than 10 points to the market's decline. Most industry groups were under selling pressure. Foreign investors continued to net sell, although their net value narrowed to only 155 billion.

▶ At the end of the trading session, the VN-Index decreased by 19.32 points (-1.45%), reaching 1310.57 points; the HNX-Index decreased by 2.12 points (-0.93%), reaching 226.49 points. Market liquidity reached 19.8 trillion VND, which was equivalent to about 918 million shares traded. Foreign investors net sold 155 billion VND, mainly focused in SHB, HAH and VCI.

▶ Technical perspective: The market recorded a continued correction session, losing 1,230 points support and returning to the lower border of the 1,290 - 1,310 points sideway range. Liquidity decreased to a lower level than the 20-session average, showing that the correction came from a lack of support in the presence of not too strong selling pressure. Sideways is still considered the main trend of the market and the factor which could strongly move the market has not showed itself up yet.

- In the positive case: The market manages to maintain the EMA50 when facing of short-term profit-taking pressure from the market, along with positive information from tax negotiations from Vietnam. This will open up a positive signal to help investors confidently disburse in the upcoming time.

- In the base case: Vietnam has no new progress on tax agreements, the main trend will still trade sideways and waiting for a clearer signal from the market.

Strategy: Investors should temporarily stop buying new stocks that have increased a lot, because cash flow can take profits and switch to stocks that are trading below MA200/MA50. For new positions, priority can be given to stocks among the real estate and banking sectors that are in low price ranges, accompanied with tight accumulation bases. However, the disbursement ratio should also be kept low.