The market has set a new record with the trading week reaching an average trading volume of nearly 27.5 trillion Vietnamese dong per session, higher than the peak week in September 2023. The end-of-week selling session also set a 7-month record with approximately 34 trillion dong. The market sharply reversed the gains in many stocks, with the VN-Index losing more than 21 points, wiping out the gains of the previous 7 sessions.
Regarding the high trading volume mentioned above, experts believe that the large influx of money into the market since Tet, the FOMO sentiment, and the high risk appetite using margin have pushed liquidity to a new record. Therefore, the selling sessions will also have a corresponding intensity.
However, experts do not seem too worried about the market’s performance. Due to the strong price increase, investors taking profits is normal, and high margin levels need to be lowered. This is a normal process of money flow and is not related to the fundamental factors of the market.
Furthermore, experts also remain optimistic about future opportunities. The fundamental factors supporting the market in the medium and long term are still very good. Money is still flowing into the stock market on a large scale. Periodic adjustments to reduce leverage and create balance are necessary and positive for the overall upward trend. Abundant liquidity will be a support for the market during corrections.
In a context where there is no extremely negative information and the medium-term prospects are relatively positive, this recent downward movement is still based on normal supply and demand, not necessarily a large-scale distribution. The market needs adjustments to reduce the heat and margin utilization and rebalance investors’ capital usage. When there is a solid support base, new buying power will have a basis to expect a return.
Mr. Nghiem Sy Tien
Mr. Nguyen Hoang – VnEconomy
Last week, there were two big selling sessions, but the trading session on March 6 was disrupted. The end-of-week selling session also saw increased selling pressure, putting deep downward pressure on the market. In the previous exchange, you were open to the scenario of the market surpassing the peak but potentially creating a “trap”. So are these the confirmatory signals? Or are they simply short-term fluctuations?
Mr. Nguyen Viet Quang – Director of Yuanta Hanoi 3 Business Center
Referring to the technical perspective, I see that the VN-Index is still in a medium and long-term upward trend, with the MA20 to MA200 lines showing positive upward convergence. And a few sessions of downward points are not enough to change the main trend.
In addition, the macroeconomic factors, with low interest rates and prospects of economic recovery thanks to the determination to increase credit as well as the expansionary fiscal policy of the Government, as well as expectations of market upgrades, are the main driving forces that maintain the upward trend of the stock market.
However, I also do not deny the negative signals in the short term. The market experienced a strong decline on March 8 with a large volume, showing continuous selling pressure across the board. Despite the efforts of some blue-chip stocks to support the market. As discussed earlier, after a prolonged rally with high trading liquidity at a high level, and as the index approaches the resistance thresholds, the buying force is more likely to have a “FOMO” nature, and the use of margin is relatively high, especially with expectations of breaking through the psychological resistance of 1,300. With this nature of money flow, the risk of panic selling will also increase. Investor sentiment can easily be turned if there are signals of unsuccessful breakthroughs or gradual weakening buying pressure, at which point the market will immediately enter a dangerous situation.
Nevertheless, in a context where there is no extremely negative information impacting the market and the medium-term prospects are still relatively positive, this movement is still based on normal supply and demand and not necessarily a distribution activity. The market needs some adjustment periods to reduce overheating and margin utilization and rebalance investors’ capital usage. Then, new buying power will have a basis to expect a return.
Mr. Nguyen Van Son – Analyst at Phu Hung Securities
Strong selling pressure with continuous intensity throughout the trading session on March 8 created pressure and negative effects on the entire market, pushing the index into an adjustment state with the widest range since November 2023, despite the support from a few blue-chip stocks. As discussed earlier, after a prolonged rally with high trading liquidity at a high level, and as the index approaches the resistance thresholds, the buying force is more likely to have a “FOMO” nature, and the use of margin is relatively high, especially with expectations of breaking through the psychological resistance of 1,300. With this nature of money flow, the risk of panic selling will also increase. Investor sentiment can easily be turned if there are signals of unsuccessful breakthroughs or gradual weakening buying pressure, at which point the market will immediately enter a dangerous situation.
However, in a context where there is no extremely negative information impacting the market and the medium-term prospects are still relatively positive, this movement is still based on normal supply and demand and not necessarily a distribution activity. The market needs some adjustment periods to reduce overheating and margin utilization and rebalance investors’ capital usage. Then, new buying power will have a basis to expect a return.
I do not deny the negative signals in the short term, as the market has experienced a sharp decline with a high volume, reflecting widespread profit-taking pressure. Moreover, the VN-Index has returned to close below the 1,250 level after surpassing this resistance level, indicating that the previous breakout signal may be a “trap” and the market’s risk is increasing for a short-term adjustment.
Generally, the recent selling session may serve as a warning for a short-term adjustment, but it does not change the overall recovery trend in the medium and long term.
In terms of timing to re-enter the market, I think the market will need a period of about 2 weeks if this adjustment is fast and strong; or about 1 month if the adjustment/consolidation is mild.
Mr. Nguyen Viet Quang – Director of Yuanta Hanoi 3 Business Center
Mr. Nguyen Van Son – Analyst at Phu Hung Securities
Based on the current money flow, I believe that the market’s correction period will not be too long. The active trading volume will ensure that the buying power is ready to return when the index falls to significant support levels, particularly around 1,230 (+-5) and further at 1,190 (+-10). Since I have reduced the buying rate when the index approached resistance levels and still maintained a 30-50% stock holding, when the VN-Index falls to support levels, I can increase the stock holding rate to over 70%.
Mr. Nghiem Sy Tien – Investment Strategist at KBSV Securities
Based on the dynamic of the market, I think the current correction period will not be too long. The trading liquidity will support the market’s return when the index falls to significant support levels. I recommend that investors realize profits when their holdings achieve reasonable returns for the short to medium-term investment period. The portfolio should avoid excessive use of leverage to avoid unexpected price declines. With the current nature of money flow, the risk of panic selling will also increase. Investor sentiment can easily change if there are signals of unsuccessful breakouts or a gradual weakening of the buying force. In that case, the market will immediately enter a dangerous phase.
Mr. Nguyen Van Son – Analyst at Phu Hung Securities
Based on the perspective that the market has not changed its medium and long-term recovery trend, the risk of a short-term correction is present. It is advisable to realize profits and stand aside when the rising wave has lasted more than 4 months, which means that if it enters a correction phase, it may last quite a while. Does that mean that some stocks in the mid-cap and small-cap range can still increase even when the market corrects?
Mr. Nguyen Viet Quang – Director of Yuanta Hanoi 3 Business Center
I expect the time to re-enter the market will be around 5-8 sessions, especially when assessing the type of correction, the price consolidation outlook. Of course, there will be some specialty stocks that can increase regardless of the general market trend.
Mr. Le Duc Khanh – Head of Research at VPS Securities
Looking at the recent market movements, I see that money has been flowing significantly into mid-cap and small-cap stocks, especially in the technology and securities sectors. However, this reallocation may continue in the coming weeks, as there is a chance that blue-chip stocks will face adjustments, but not all mid-cap and small-cap stocks will attract money flows.
Based on the recent movements, I believe that the market will continue to be supported by the positive factors mentioned above. However, it is also important for investors to be cautious and selective, as mid-cap and small-cap stocks tend to be more volatile and may require careful stock picking, especially with the current high valuation levels.
