Up to now, the VN-Index has had 3 consecutive weeks of increase with an increase of nearly 6.5% to bring the VN-Index closer to the strong resistance level of 1,290-1,300 points. The increase is supported by the rotation of demand from individual investors, domestic organizations and foreign investors.
The market had a big positive step when liquidity increased sharply to surpass the 1,250 zone, but closed the week right at the important 1,270 level. However, unlike previous times, liquidity last week improved quite well and if we can stand firmly above this level next week and the cash flow continues to improve, we can expect the market to soon return to the 1,300 zone.
This is a strong resistance zone that has been maintained throughout the past 2 years, along with the technical recovery that has brought many technical indicators to the overbought zone. There will likely be tug-of-war periods near strong resistance to absorb profit-taking selling pressure.
To make the cash flow vibrant, the market needs to relieve investor psychology. Currently, it can be seen that investors will generally tend to minimize risks and be more cautious as the FED's FOMC meeting approaches, which is expected to be very important in assessing the USD trend in 2025.
However, analysts are quite unanimous in assessing that the medium-term outlook of the market is still positive. Vietnam's macroeconomic conditions are somewhat brighter when compared to many other markets, however, the relatively low interest rate level when compared to more developed markets is a factor hindering the flow of money into the Vietnamese financial market.
Therefore, the global economy is showing signs of improvement, creating an opportunity to lower operating interest rates in major economies, especially the US. If the FED's interest rate reduction roadmap follows the expectations of many analysts, exchange rate pressure will also become more comfortable and the Vietnamese market will also become more attractive and attract foreign capital back to the Vietnamese market.
If observed, it can be seen that the recent increasing sessions have seen a relatively strong return of net buying from foreign investors. Although the proportion of foreign investors' transactions later no longer accounts for a large proportion of the liquidity structure of the VN-Index, the net buying of foreign investors still has a significant impact on the general sentiment of the market. Therefore, foreign transactions will also be an important factor to support the market.
Smart money is likely to continue to circulate, looking for opportunities in stocks with positive business results expectations throughout the year, especially in industries that benefit from supportive policies and a favorable macro environment. Moreover, the valuation level of the Vietnamese market will also be a support for cash flow when the market's P/E is currently still around the average level of many years.
If the business results of enterprises in the fourth quarter are favorable, the valuation level will be lowered and stimulate stronger cash flow. And especially the re-participation of the real estate group. This will be considered a new factor to help the VN-Index surpass the 1,300 point level in the near future.
