The recent volatility in the leading stocks has once again posed challenges for the VNI in the same peak range as the session on May 16th. While the index is still being pulled and pushed, the damage to individual stocks is evident. The opportunity for contrarian plays is narrowing, and it’s becoming harder to make the right choices.
The abrupt U-turn in VIC this afternoon is just one example; many other blue-chips have been weak for several recent sessions and are now even weaker. In the end, the market cannot rely solely on a handful of large-cap stocks. The poor breadth has persisted since last weekend, and many stocks are at risk of entering a clear corrective phase.
The upward cycle is being shortened and could form a short-term distribution signal. In reality, this is easier to observe in individual stocks than in the index. This is a consequence of the increasingly popular view of quick trading – taking profits as soon as possible. This approach is not inherently negative; it reflects a cautious mindset that prioritizes safety over risk-taking. Sessions with declines or fluctuations, such as rising before falling, tend to have higher trading volume than sessions with consistent gains. If this situation persists, it will be a typical distribution signal, although it may not necessarily lead to a breakdown in the primary trend.
The number of contrarian stocks today has decreased significantly. Among the decliners are many stocks that were “attacked” with high trading volume after a long upward move. Many stocks managed to surpass the May 16th session and continue their T+ rise, only to experience further large transactions. Even stocks that have multiplied in value still attract significant buying interest, indicating a “thrill-seeking” mentality. However, history has shown that such “parties” rarely end happily. When the strongest individual speculative waves recede, hot money will also gradually diminish in intensity.
Today’s liquidity on the two exchanges was quite high, reaching 26.4k billion excluding matching, setting a 20-session record. The continuous large trading sessions of this week will be crucial in determining the market’s direction, as a weekly timeframe could signal exhaustion. Most stocks have already weakened earlier, and if the market undergoes a short correction, stocks will likely fall more than the index.
At this point, it’s essential to tightly manage your portfolio, especially for short-term positions. Contrarian trading opportunities are dwindling; the risk of making wrong choices is increasing, and the time window for catching the right wave is narrowing.
The derivatives market today witnessed a wide discount from the very beginning, possibly influenced by the sharp decline in US stocks last night. In theory, this favors the Long side, but as VN30 climbs higher, the basis widens. For example, when VN30 retreated to retest 1416.xx at the beginning of the morning session, the basis differed by nearly 8 points, but when VN30 surpassed 1426.xx, the difference exceeded 12 points. This limits profit margins and makes it challenging for Short positions to initiate trades unless the entire session is designed for a Short strategy setup.
With increasing liquidity and deteriorating stock performance, risks are also on the rise. Short-term positions should be closed, and there’s no need to rush into quick capital rotations. It’s uncertain when the remaining contrarian stocks will reach their endgame. The strategy is to wait for buying opportunities, employing a flexible Long/Short approach with derivatives.
VN30 closed at 1409.56. The nearest resistance levels for tomorrow are 1412, 1421, 1427, 1436, and 1441. The support levels are 1406, 1396, 1389, 1383, 1377, and 1373.
“Blog on Securities” reflects the personal perspective of the investor and does not represent the views of VnEconomy. The opinions and assessments expressed are solely those of the author, and VnEconomy respects the author’s perspective and writing style. VnEconomy and the author are not responsible for any issues arising from the published opinions and investment perspectives.
The VN-Index Plunges by 9 Points as Proprietary Traders Sell-Off
Today’s liquidity across the three exchanges reached 28 trillion dong, indicating that money is still pouring in confidently at current price levels. The VIPs net sold 357.8 billion dong, and they net sold 412.6 billion dong in matching orders alone.
Surprising Drop in Liquidity, Stocks Soar.
The liquidity in many stocks suddenly contracted, with a notable decline of 45% in the VN30 blue-chip stocks compared to yesterday’s morning session. Despite this contraction, the market didn’t perform too badly, as funds continued to flow dynamically, and today it was the turn of securities stocks to take the lead.
The Art of Market Manipulation: VN-Index’s Dangerous Dance with Blue Chips
The robust upward momentum witnessed right after the morning session opened today propelled the VN-Index into the March peak zone. However, this rally was solely driven by large-cap stocks. As these heavyweight stocks started to lose steam, the index gave back almost all of its gains, ending the day with a marginal increase of less than 1 point, despite being up nearly 16.5 points earlier.
“Markets Soaring High: Vietstock Daily Overview for May 21, 2025”
The VN-Index surged, dismissing the previous two sessions’ losses with the emergence of a White Marubozu candlestick pattern. This reflects a highly optimistic sentiment among investors. However, trading volume needs to show a marked improvement for the index to sustain its upward trajectory. If the VN-Index firmly holds above the current level, it may have the potential to revisit the old peak of March 2025 (around the 1,320-1,340 range). Notably, the MACD indicator has maintained a buy signal since late April 2025, boding well for the short-term outlook if this status quo persists.
Market Pulse: Red Alert!
The VN-Index took an unexpected turn in the afternoon session, plunging over 9 points to close lower, contrary to the hopeful trajectory it had set in the morning with a near 9-point gain.
