The market weathered the correction relatively well today, with liquidity decreasing but the increase in stock prices being positive. This indicates that selling has eased somewhat. After a week of sharp declines, there is an opportunity for recovery, or at least for the market to stabilize and create a steady foundation.
A rise in prices with low liquidity often raises concerns about cash flow. However, just as with a decline accompanied by very high liquidity, it is important to pay attention to the motivation behind the liquidity rather than the liquidity figure itself. Every transaction entered into the system reflects the psychological state of the investor. Unless there is technical selling, sentiment can change very quickly.
Today, selling pressure has decreased, which is a positive sign, even if prices have not risen sharply. In a rapidly accelerating downward trend, it is essential for those holding stocks to remain calm, before considering whether those with available cash are willing to buy. It is important to recognize that the market is undergoing a normal correction rather than a crisis, so changes in supply and demand will help reverse the trend. Money is still in accounts and has not been withdrawn; it will eventually return.
Today’s reversal has not yet provided enough signals to confirm a bottom, but it increases the possibility of one forming. The tug-of-war in this range will continue for several more sessions to test supply and demand, and there may even be strong fluctuations to force out supply. Observing trading during such sessions will reveal signals that either reinforce or negate the scenario of the market forming a bottom.
We maintain our view that the market is in a buyable range, with the possibility that the correction phase has passed its most volatile stage and is gradually stabilizing. The signals of stability have become clearer for quite a few stocks than for the indices, meaning that there is underlying demand supporting them sooner. Today’s price increase was quite positive, with many stocks that bought at the bottom easily erasing their losses. Sentiment is starting to become more optimistic, with investors finding more “reasons” to be less fearful, even though they were “speechless” just last week.
Trading in the derivatives market was a little slower today, with liquidity decreasing by almost 20% compared to the previous session. Both Long and Short positions have acceptable setups. Short positions were more profitable in the morning due to a positive basis, but Long positions were somewhat disadvantaged in the afternoon. VN30 has a narrow range from 1202.xx to 1208.xx; if it rises or falls beyond this range, it will enter a wider range. The decline in the afternoon did not reach its target, and neither did the increase, but trading was not difficult.
After today’s “customer retention” recovery session, the market may weaken again or even intensify its volatility. It is not necessary to chase stocks; there will always be dips to enter at good prices. The strategy remains to look for buying opportunities and to use Long/Short positions flexibly with derivatives.
VN30 closed today at 1206.64. The nearest resistance levels tomorrow are 1208; 1216; 1222; 1233; 1238; 1245. Support levels are 1203; 1198; 1194; 1186; 1179; 1168.
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