Vietnam Insight

▶ The market opened at the reference level after a volatile trading session the previous day. The pressure of foreign net selling pushed the index below the reference level throughout the morning session. Although foreign investors continued to net sell strongly in the afternoon session, the overwhelming buying power of domestic investors helped the index recover impressively. Banking and real estate stocks contributed greatly to the index's recovery.

▶ At the end of the trading session, the VN-Index increased by 22.20 points (+1.36%), reaching 1,657.46 points; the HNX-Index increased by 4.27 points (+1.56%), reaching 277.28 points. The liquidity of the whole market remained relatively low at VND 29.8 trillion, equivalent to 1.125 million shares traded. Foreign investors net sold strongly VND 1,506 billion, of which the largest net selling value was in VHM, SSI and VPB shares. On the contrary, CII, DIG and BID were the typical net-bought stocks.

▶ Technical perspective: The market continued to face slight selling pressure in the morning session and at times fell to 1,619 points. Around MA50, the market saw demand and recovery signals were confirmed when liquidity in the VN30 group increased sharply in the last 30 minutes of the session. According to our analysis, VN-Index is currently moving in the range of 1,600-1,700 points, so when there is no new information, the market is out of supply and there is demand at the lower limit. The index is likely to recover towards 1,700 points in the following sessions if there is no negative information. VN-Index is currently trading above MA50 and RSI is at a neutral level, around 50.

In the positive case: Rumors about market upgrade can help attract new cash flow and move towards 1,750-1,800 points. Cash flow increases on the upside, the amplitude increases and spreads across the market.

In the negative case: The market faces profit-taking pressure when the upgrade news is announced, the amplitude of the falling sessions is large and breaks the short-term support zone of 1,600 points. If this level is broken, the market is likely to retest the 1,500-1,550 point area, corresponding to MA 50. 

Strategy: Prioritize the strategy of holding and being ready to sell when reaching the target. For short-term traders, if the market corrects to around 1,600 points and rebounds, it is possible to consider disbursing a low proportion. If the market returns to the 1,540 point area, there will be a clearer buying opportunity for medium-term positions. Investors can disburse more strongly, focusing on groups of stocks with many driving forces such as benefiting from upgrading, strong business results; or lower valuation levels compared to the general market.