Vietnam Insight

▶ In the trading session on Wednesday, the VN-Index experienced slowing down activities while confronting the previous peak. The market showed mild increase in the morning session, however, selling pressure emerged in the afternoon session and caused the market to fall below the reference level, though it still successfully closed around this level. The foreign group returned to net sell with a slight value of 277 billion VND, mainly in FPT shares. Liquidity remained at a modest level, fluctuating below the 20-session average threshold.

▶ At the end of the trading session, the VN-Index decreased by 0.86 points (-0.06%), reaching 1,346.83 points; the HNX-Index decreased by 0.04 points (-0.02%), reaching 228.24 points. Liquidity of the whole market reached 22.1 trillion VND, equivalent to about 957 million shares traded. Foreign investors net sold VND277 billion in today's session, mostly focused in FPT, VCI and STB. On the other hand, HPG was the stock with the most net buying value.

▶ Technical perspective: The market recorded an unsuccessful test of the 1,350 zone due to a lack of consensus from cash flow. Low liquidity fluctuated below the 20-session average, indicating that demand was not strong enough for the index to successfully surpass the resistance peak. Sideways is still considered the main trend, and the factor that could lead to a significant change in the trend has not showed itself up yet. 

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

- In the base case: If Vietnam has no new progress on tax agreements, the main trend will still be trading sideways and waiting for a clearer confirmative 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.