Stocks face correction this week

Analysts are cautious about market developments this week, predicting that short-term adjustment pressure is high.

The market has just recorded a week of volatile trading, with alternating increases and decreases as the index approached a strong resistance zone. Active selling liquidity continuously increased each time the VN-Index approached a strong resistance near 1,120-1,125 points. In the last session of the week, strong selling pressure returned at the end of the session, causing the index to reverse and fall below the reference level.

Liquidity in the last sessions of the week has decreased somewhat compared to the average of 10 sessions, according to Vietcombank Securities Company (VCBS), showing that investors are still cautious before the above resistance level.

Forecasting this week, VCBS analysis team believes that the probability of a short-term market correction is high. On the hourly chart, the MACD and RSI indicators also simultaneously signal a short-term decline.

However, the analysis team still assesses that the market is developing positively and the appearance of fluctuations is necessary to create momentum for the VN-Index to move towards higher points. In a positive scenario, the HoSE index may accumulate, increase and decrease alternately with an amplitude of about 20 points around the 1,110-1,130 point area.

"We recommend that investors closely follow market developments this week, maintain a cautious mindset and patiently wait for the market to show signs of balance before returning to new disbursements," VCSB report wrote.

Sharing a cautious view, KB Vietnam Securities Company believes that VN-Index is likely to continue its downward momentum in the first session of this week, falling to the support level near 1,105 - 1,110 points and deeper to 1.09x to find bottom-fishing demand.

Similarly, Rong Viet Securities Company (VDSC) shared the view that the market has not been able to successfully overcome the resistance zone of 1,125-1,130 points due to profit-taking pressure continuing to appear and put pressure on this resistance zone. Liquidity increased significantly in the last session of the week before the index reversed, also showing the presence of selling pressure.

However, the decline is still relatively low, which may indicate that the cash flow waiting to buy is also making efforts to support and prevent the market from falling further. According to VDSC, the market will need time to re-examine supply and demand around the current point before there is a more specific signal.

KB Vietnam analysis team recommends that investors continue to apply the rotation trading strategy, holding a part of the position and combining buying at support - selling at resistance for each individual code with the remaining position.

Minh Son

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