The stock market is still in a wave of capital recovery that has lasted since the Lunar New Year holiday, this development is part of a tug-of-war trend within the range of 1,250-1,300 points. Although it has been 3 weeks of trading quite positively, there has not been any sign of really turning the trend around.
In the past week, the liquidity of the stock market continued to improve to about VND17,000 billion/session, helping to absorb the pressure of short-term interest rates well and bringing the market closer to the strong resistance of 1,300 points.
The increase in liquidity in recent times is assessed by experts to be due to the shift of cash flow from the savings channel when banks have increased deposit interest rates since the end of last year, but this figure is still significantly lower than the period before the COVID-19 pandemic.
Along with the attractive market valuation after the fourth quarter financial report announcement season and the USD starting to show signs of weakening again as investors reduce expectations of the Fed's interest rate cut in the January policy meeting; investors are still very hopeful that the VN-Index will continue to maintain the uptrend and fluctuate within the range of 1,285-1,315 points.
The VN-Index has recently gradually approached the strong resistance level of 1,300 points. The confidence level has improved compared to previous inspections thanks to the recovery of liquidity.
However, as the resistance level is approaching, the breadth of the increase has spread, the spread has approached the market's 90%, while the number of stocks reaching new buying points has gradually decreased and waiting for reselling to increase, showing that the opportunity for the general index to break out easily is not high.
According to HSC Securities Company's analysis, even in a positive scenario when an early breakout occurs at the 1,300-point zone, the VN-Index will likely have to carry out the confirmation of the breakout signal as well as this new support with subsequent adjustments. Therefore, in terms of opportunities, new buying transactions should be patient when the "collision" is approaching, opening a position in a state of decline in the market will bring a low probability of success, even risk.
In the trading session last weekend, cash flow continued to maintain a fairly good circulation, focusing on industrial park real estate, construction and construction materials, and insurance. The increase that has lasted until now is mainly due to the leading and supporting role of large-cap stocks in which banks are the most important pillar.
In the optimistic scenario, the VN-Index will continue to rely on the ability of large-cap stocks to rotate flexibly to retain and attract more cash flow to the market. The remaining task of other stocks is to "turn around" the new round, if the strict adjustment criteria are met, they will continue to recover to complete the wave target price point. Although the net selling cash flow from foreign investors has decreased, it is still a deduction, hindering the scenario of VN-Index exceeding 1,300 points, experts from HSC Securities Company gave their opinion.
According to experts from Asean Securities Company, the market will continue to recover, however, the resistance level of 1,300 points needs special attention in the trading sessions next week. This is an important resistance level that has been established since August 2022, and the market has not been able to overcome it yet. With market liquidity gradually improving, we believe the market is at the end of the accumulation cycle with strong growth potential in the long term. Therefore, investors can consider disbursing when the market has an explosive session accompanied by confirmed high liquidity.
