Vietnam Insight

▶ The market fluctuated within a narrow range in Wednesday's session, accompanied by a continued decline in liquidity to a record low, indicating the hesitation of both sides before the official announcement of the market upgrade. Closing with a slight increase of more than 3 points, the VN-Index ended the session at 1,665, currently about 50 points lower than the peak established in September. Foreign investors’s net selling momentum has not stopped due to exchange rate pressure, yet the net selling amount was bigger than yesterday. 

▶ At the end of the trading session, the VN-Index increased by 3.35 points (+0.2%), reaching 1,665.05 points; the HNX-Index almost remained flat with an increase of 0.06 points (+0.02%), reaching 273.22 points. Total market liquidity dropped sharply to 23.2 trillion VND, which was equivalent to 810 million shares traded. Foreign investors sold a net amount of VND 1,650 billion, with the largest net selling value belonging to VHM, FPT and MWG. On the contrary, VIX, LPB and TCH were the typical net-bought stocks.

▶ Technical perspective: The market experienced a 4th session of sideways movement with very low liquidity and narrowed fluctuations. The financial and banking groups increased in points, helping the index remain unchanged in a correction session of the VIN group. In general, the market is maintaining a sideways state around 1,600 - 1,700 points to wait for the official upgrade information on October 7. VN-Index is currently trading above MA50 and RSI is at a neutral level, around 50.

In the positive case: Rumors about the market upgrade can help attract new cash flow and move towards 1,750 - 1,800 points. Cash flow increases in the upward direction and large amplitude will strengthen the market's uptrend.

In the negative case: The market faces profit-taking pressure when the upgrade news is announced, the amplitude of the down 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 (this is also the old peak area in 2022). 

Strategy: Prioritize the holding strategy and being ready to sell when the target is reached. 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 stock groups with many driving forces such as benefiting from market upgrading, strong business growth results; or lower valuation levels compared to the general market.