Vietnam Insight

▶ The highlight of Thursday's trading session was the intensified net selling by foreign investors, reaching over VND 3,000 billion, with the largest contribution coming from VNM with a net sell value exceeding VND 2,200 billion. Over 73 million shares were exchanged at the floor price as today marked the deadline for Platinum Victory fund to execute its full divestment as registered. The market continued to exhibit high polarization, as the VinGroup stock group bucked the general trend and led the index upward, with VIC alone contributing nearly 17 points to the VN-Index's gain. Consequently, the market recorded another gaining session, moving closer to its previous peak around 1,900.

▶ At the close of the session, the VN-Index rose 18.73 points (+1.01%) to finish at 1,879.64 points; the HNX-Index fell 0.9 points (-0.34%) to 262.33 points. Total market liquidity reached VND 33.7 trillion, a decrease compared to yesterday, corresponding to nearly 1 billion shares traded. Foreign investors recorded a net sell of VND 3,070 billion, with prominent net selling noted in VNM, HPG, and VHM. On the other hand, notable net-bought stocks included HPG, PNJ, and BSR.

▶ Technical perspective: VN-Index experienced light volatility during the morning session with low liquidity; however, by the end of the session, numerous stocks exhibited "bottom fishing" tails (pin bars) as cash flow surged back strongly. This indicates that market fluctuations are primarily serving to absorb supply as the index approaches its historical peak, with liquidity showing no signs of heavy distribution. Such movements are typical within a medium-term uptrend. The primary trend remains bullish, and there is still room for further upward momentum if liquidity levels remain positive.

From a statistical perspective, we monitor the percentage of stocks trading above their 50-day Exponential Moving Average (EMA50) as an indicator to identify market bottoms. Historically, the VN-Index typically confirms a bottom when this ratio fluctuates between 30% and 40% and forms a peak around the 60-70% range. With the current figure at approximately 40-45%, the data suggests that there is still growth potential for the majority of stocks.

Base Case: After surpassing 1,800, the market is retesting the upper bound of the previous sideways range (around 1,720-1,780). For the uptrend to be sustained, we expect buying demand to emerge around this zone, helping the VN-Index regain its upward momentum with improved liquidity and positive market breadth.

Bearish Case: In a negative scenario, if the VN-Index continues to decline sharply and loses the previously accumulated sideways channel of 1,600-1,700, investors should consider reducing their positions to manage portfolio risk.

Strategy: Short-term investors can capitalize on intraday volatility to increase their weight in stocks attracting cash flow and leading sectors. However, as the index has surged and entered higher resistance zones, risk management is essential. Investors should avoid chasing prices (buying-at-any-cost) during periods of market euphoria, maintain reasonable position sizing, and proactively lock in partial profits once stocks reach their targets.