In the recent program “Following the Money” organized by Fiingroup and FIDT Joint Stock Company, Mr. Nguyen Thanh Nguyen Vu, a securities data analysis expert, founder of TVN & Partners, outlined some parameters that investors should pay attention to, including the rate of increase or decrease in the Vn-Index and the trading speed of the market.
SIGNS OF MARKET BOTTOMING AND RECOVERY
According to Mr. Vu, there will be 3 steps for investors to assess the market’s adjustment rhythm. Step 1, record the fluctuation of the Vn-Index in the range of 0.8-1.2% and a decrease of more than 1.2%. Temporarily call the first day of decline as day D1 and observe.
Step 2, observe the trading rhythm – assess the logic. According to O’neil’s method, if the market increases by more than 5% from day D1, note the noise if the market increases due to the Large Cap Group. The score increases but the deletion of the distribution day or the counting of the distribution days will be complicated and inaccurate.
Step 3 is action. The distribution process usually lasts 2 months and is divided into 2 phases – similar to the recovery process after a major adjustment. During this process, the market will create a peak and then sideway down, continue to distribute through the bottom-fishing stimulus sessions, bulltrap.
During the process of creating a peak or a distribution process, there will be an average of 2 weeks/batch equivalent to 8 – 10 trading sessions, there will be some hidden distribution sessions. The hidden distribution signal is that the VN-Index increases points with a trading speed that is more than 30% – 40% higher than normal while the buying power does not increase much, there is no chasing to raise for selling or the VN-Index increases slightly buying pressure decreases but not much supply, distribution is tight over many consecutive days.
Regarding the signs that the market is bottoming out, the founder of TVN & Partners gave some parameters: The spread level is extremely low or from extremely low to high spread right in the session; The purchase rate is at low but goes sideways throughout the session or has signs such as the spread; The trading speed is equal to or greater than 3.5 million stocks/minute or 4.5 million stocks/minute will be more prestigious; The VN-Index decreases strongly or goes from extremely low to strong recovery in the session.
Signs of the market officially recovering: The spread reaches about 41%; The purchase rate reaches over 52%; The trading speed is over 3.5 million stocks/minute, then that session officially confirms a U-turn, usually these sessions are about 2-3 sessions from the bottom.
Commenting on the market in April, according to Mr. Vu, on April 15, the VN-Index dropped sharply by 59 points, the strong correction period within 2 weeks and sideway will take place within 2 months, estimated until the end of June 2024.
“Sentiment predicts that there will still be strong and close correction because the market has a broad technical recovery but the trading speed is not in line with it. If the VN-Index decreases to 1188, it is still manageable, 1140 – 1160 is suffocating for those who hold stocks at the top but it is a very good opportunity to accumulate stocks,” the expert emphasized.
WHERE IS THE MONEY FLOWING TO?
Despite this, the expert expects the Vn-Index to reach 1,380 points at the end of Q3/2024. Money will flow to the following groups: Firstly, the group of large-cap basic enterprises with deeply adjusted prices. Vn-Index If the rapid recovery to the score is a hollow order recovery, because the segment 1215 – 1193 has a strong selling force. Investors should pay attention to bank and large-cap, super-large-cap group.
The securities industry group announced very good profits in Q1/1024, the business was really effective and received attention from the Government.
Group 3, some commercial bank stocks with outstanding business operations, the market in an uptrend will always have bank stocks contributing weight.
The real estate group with pure stocks according to cash flow. Finally, the oil and gas + information technology industry, the story of enterprises and the industry.
Adding the idea of finding stocks that bottom out early, according to Mr. Vu, in a context of general panic, selling a large volume, then the stock with a reverse cash flow that absorbs enough or holds its price should be noted. Going through many such sessions will create a reliable supply and demand verification price zone.
Pay attention to stocks that were sold by individuals from April 16, large volume and were bought by organizations at the same time, the price may drop further, it has shown that there has been a accumulation of goods. These stocks are SSI, VCI, EVF, HCM, HPG, KDH, KBC, GEX, PVT, DGC, PVD.
Regarding the valuation of the market, Mr. Huynh Hoang Phuong, Director of Investment Research and Analysis of FIDT Joint Stock Company believes that the market valuation according to P/E and P/B in the VN-Index area 1160-1180 is relatively attractive this year. With the expectation that the profit of listed enterprises in 2024 will increase by about 18%, then forward P/E of 11.8 is an attractive level to open a new position for the whole year.
The fundamental factors that greatly affect the market in the medium and long term are economic growth, profit growth of listed enterprises, interest rates, and the upgrade story, which is still a positive supportive factor for the market.
Short-term risks from the beginning of April will gradually reduce pressure in May, but still need to be noted such as exchange rates.
After the panic passes, the market will have certain recovery sessions and good stocks in terms of fundamentals with good growth in 2024 or a separate story will continue to recover and grow then less dependent on the general index.
With the Oil and Gas group, the prospect of Block B is still good and has not changed. The general market correction has helped stocks in the good price range. PVS, PVD, PVD.
