The buyers’ risk appetite has significantly increased, immediately altering the way orders are placed and the selected price range. Today’s market still witnessed many swinging movements, but they remained in the green zone and became more enthusiastic towards the end.
After a session of touching the bottom with a “pullback candle” and a session of tug-of-war balance, the market began to accelerate upward. The most obvious change was from passively waiting for prices to actively blocking around reference prices, and today is about pushing prices up. This development stems from a change in the perception of risk: when afraid of further price drops, one either refrains from buying or waits for very low prices, and it’s okay if the desired price is not met. When the fear subsides, one starts to buy tentatively during price dips within the session. Eventually, when afraid of missing out on low prices, one buys by matching orders directly and, finally, turns to competing for prices.
Today’s liquidity was quite good, with a total matched order volume of about 16.9k billion VND across the two exchanges, showing an upward trend. The new information is that the Vietnamese market has not been considered for a ranking change, which, in theory, is not positive. However, the way the market reacted shows that the information itself is not inherently good or bad. When the sentiment is enthusiastic, supply and demand become the deciding factors.
The VN30 blue-chip group today led the strong rally, and the representative index of this basket also performed the best. In recent sessions, capital has been focusing on this group, with a high weight of over 50% on the HSX floor. In fact, if we look at the index, the VNI failed to break the 1300 peak at the end of September and early October, but the VN30 has already broken through, and the recent dip was just a retest of the old resistance zone. The uptrend on the VN30 is much clearer, both in terms of momentum and liquidity.
Today’s market also widely circulated forecasts of Q3/2024 financial results. In fact, this information is old news, but the interesting thing is that when sentiment needs to find a foothold, whether the news is old or new doesn’t matter; what matters is whether it meets the needs of the moment. Everywhere, people start talking about how this stock will increase profits well, and that stock will surge, which no one cared about yesterday or at the beginning of the week. Such psychological developments always repeat themselves and remain effective.
There is now a growing acceptance of chasing higher prices, so the opportunity to buy at lower prices is diminishing. This is not necessarily a disadvantage because the purchases made during the dips already have a low cost basis. There will always be intraday fluctuations even when the market is enthusiastic. Consensus has not yet been fully achieved.
Today, the futures market continued to maintain a wide basis difference. In the last 2.5 sessions, this signal has indicated that expectations are in line with the underlying market. Although a wide positive basis is unfavorable for Long, when the market strengthens, there is no other way, and Short is even riskier. In fact, even during intraday dips, F1 adjusted very little.
The threshold of 1341.xx for VN30 provided strong support for the index, serving as a good entry point for Long positions with a stop loss if VN30 falls below this level. VN30 broke through 1348.xx but failed to reach 1356.xx, however, the basis widened further, which is advantageous.
Today’s strong rally is a signal of greater consensus from the sell-off signals and the changing buying sentiment. The market has established a short-term bottom for this correction phase, which is also just a typical corrective move. The strategy remains to look for buying opportunities, Long/Short flexibility with derivatives, and a preference for Long.
VN30 closed today at 1351.97. Tomorrow’s nearest resistance levels: 1357; 1367; 1376; 1380; 1388; 1397. Support levels: 1348; 1341; 1333; 1325.
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