Vietnam Insight

▶ The index opened the trading session with a sharp gain of 20.41 points after reaching a new peak in the previous session. Foreign investors continued their strong net buying, pushing the index to a historical high, surpassing 1,850 in the previous session and approaching 1,900. State-owned stocks contributed significantly to the index today; however, the correction in Vingroup stocks overshadowed the index's gains.

▶ At the close of trading, the VN-Index fell 6.02 points (-0.32%), to 1,855.56 points; the HNX-Index fell 0.30 points (-0.12%), to 249.10 points. Market liquidity during the correction session showed impressive growth compared to previous sessions, indicating strong demand. Liquidity exceeded the 20-day average, reaching VND 43.3 trillion, corresponding to 1.423 million shares traded. Foreign investors net bought VND 521 billion, with the largest net purchases in VIC, SHB, and TCX. Conversely, MCH, VHM, and ACB were the stocks with net selling.

▶ Technical perspective: The VN-Index experienced significant volatility, rising 30 points in the morning session, then facing profit-taking pressure at the end of the session, causing the market to reverse and decline with a surge in trading volume. This indicates intense tug-of-war between buyers and sellers as the index approached the resistance level of the long-term trendline. However, today's session is considered a strong correction, helping to change the leading sector, and no reversal signal has yet appeared. The 1,800 point level remains a strong resistance level; the market may experience alternating periods of gains and losses to retest this resistance level.

In a positive scenario: After breaking above 1,800, the market will continue to rise towards a suitable valuation zone around 2,000. Currently, there are no technical resistance levels ahead. Furthermore, the market shows a leading sector group that then spreads to other sectors.

In a negative scenario: The market is likely to correct by about 20-30 points to the 1,800-1,820 range before returning to an uptrend.

Strategy: Short-term investors can participate in stocks showing strong upward signals above the 20-day moving average (MA20), such as banking, oil and gas, utilities, and state-owned enterprises. Corrections to the 1,800 range may open up new buying opportunities. For medium-term investors, dips to the area near 1,720 are good opportunities to invest.