In the past week, although the market experienced some fluctuations, the recovery trend still played a leading role when the VN-Index regained its score after a period of sharp decline and breaking through the 1,600-point mark.
After a volatile October, the VN-Index recorded two consecutive weeks of recovery in November. The market is currently in a state of "recovery in doubt" when liquidity remains low due to supply shortage when new cash flow is still cautious to observe, while the holding side is waiting for a higher price to cut losses.
The average liquidity of the 3 exchanges reached nearly VND 24,100 billion/session, up slightly by 2% compared to last week but still low, showing investors' cautious psychology in the face of market fluctuations.
Investors limit large transactions, while the market lacks supporting information as November has just passed half and the business results reporting season is still quite far away.
Although the "supply" state has formed, reflected in weak semi-forcement and narrowing range, the market still lacks a strong momentum to trigger new uptrends. Liquidity has not decreased to the point of creating a tight accumulation foundation like in previous breakthrough periods.
However, cash flow is not leaving the market but is restructuring to stocks with attractive valuations and better growth foundations. This is reflected in many medium and small-cap stocks maintaining good liquidity, attracting new capital flows in industries with their own growth stories or benefiting from the economic recovery cycle.
With the less positive developments of the international stock market in general, the commodity market or crypto due to concerns about AI bubbles, the possibility of the FED keeping interest rates unchanged or the BOJ increasing interest rates in December, while real estate lending interest rates in Vietnam at some commercial banks are starting to increase again, the high probability is that the VN-Index needs to find a second bottom to be able to open a more sustainable increase period in the coming time.
Regarding the prospect of next week, after having a correction from the peak since mid-October, the VN-Index is still in a sideway trend around the 100-point threshold from 1,580-1,680. In early next week, if a high liquidity session appears but cannot surpass the 1,670-1,680 point range, meaning that the VN-Index has not been able to break this sideway trend, the market will likely create a short-term peak and reverse down to retest the bottom on November 10 at 1,580 points.
Although investors' reservations may create unexpected corrections, the valuation level is not currently high enough to trigger deep downward pressure.
In case the VN-Index falls below the 1,600-point range, low-priced buying power is likely to soon return, especially from investors with value strategies. At that time, the fluctuations will mainly play a role in restructuring the portfolio, then the index is likely to return to the level of 1,6001,700 points.
Investors should not FOMO disbursement at the present time to avoid the risk of being caught up in bull trap, but need to wait patiently for the session to confirm the trend of exceeding 1,680 with large liquidity. In addition, investors should also limit catching the bottom of the high beta group such as Banking, securities, and real estate because these stocks have not yet escaped the downtrend and will need a lot of time to accumulate.
