Some stocks to watch on August 5

Market reversal signal not confirmed yet

The stock market experienced a week of relatively strong fluctuations, in the context of the buying force still acting cautiously while the selling side was relatively fierce, especially in the last 2 trading sessions of the week. The VN-Index moved relatively peacefully in the first 3 sessions of the week. Positive signals emerged when the market recovered both in liquidity and points. However, the cash flow was always passive and waiting at low prices. The selling side showed impatience and sold massively in the last 2 sessions of the week, causing the market to adjust, breaking through the bottom of the previous week. Selling pressure spread throughout the market, the large-cap group could no longer maintain the strength of the previous sessions, causing the index to drop quite quickly, to the lowest level since the beginning of May. Positive signals gradually returned in the last minutes of the session on August 2, the market recovered nearly 30 points, temporarily dispelling the pessimism of investors. Closing the trading week of July 29-August 2, the VN-Index closed at 1,236.60 points -5.51 points (-0.44%), ending a turbulent trading week.

Market liquidity has improved, only 10.9% away from the average level of 20 trading weeks. Accumulated to the end of the trading week, the average matched liquidity on the HSX floor reached 649 million shares (+4.23%), equivalent to VND 16,067 billion (-0.19%) in trading value.

The market was still immersed in red last week when 17/21 industry groups decreased points. The most overwhelming correction pressure occurred in the following industry groups: Telecommunications Technology (-7.41%), Chemicals (-5.09%), Construction (-4.33%),... On the contrary, the industry groups that increased points against the trend include: Retail (+2.12%), Oil and Gas (+1.04%), Fertilizer (+0.46%), Banking (+0.21%).

According to experts from the Construction Securities Company (CSI), the VN-Index reversed to increase quite impressively in the last trading session of the week on August 2. However, liquidity decreased compared to the sell-off session on August 1 and was only equivalent to the average of 20 sessions, so the market reversal signal has not been confirmed. Summing up the trading week between July and August, the VN-Index closed in red. However, a positive signal appeared when the decline narrowed significantly on the weekly chart, helping the VN-Index successfully defend the support level of 1,219 points (MA34-week moving average).

“On the daily chart, the upward reversal session at the end of the week of August 2 cannot be concluded that the market has bottomed out, but it is still a signal that demand has begun to increase. Investors should still be cautious, temporarily not opening new buying positions or increasing the proportion of stocks in their portfolios, instead need to patiently wait for clearer positive signals. In the downward trend, we expect the 1,195-point threshold to continue to be an important support level for the VN-Index this week,” said the CSI expert.

T+ demand may appear in today's trading session

According to the analysis team of ASEAN Securities Company (ASEANSC), the market had a positive recovery session with strong demand at the end of the session and spread to help improve the general market sentiment. Moderate liquidity was not too large, showing that demand was still cautious and only locally expressed in a few stocks. However, with the overwhelming buying movement, VN-Index increased the probability of forming a second bottom. However, the rapid and strong recovery at the end of the session could not be fully reflected in the context that the market had not officially bottomed and T+ demand could appear in today's trading session, August 5.

“Investors should avoid chasing and only buy back during market corrections, if the bottom is established this week, August 5-9,” ASEANSC experts noted.

Experts from Saigon - Hanoi Securities Company (SHS) said that the short-term trend of VN-Index is still negative after the unsuccessful recovery to retest the resistance zone around 1,255 points, corresponding to the highest price zone of the year as well as the short-term and medium-term trend line connecting the lowest price zones in November 2023, April 2024 and July 2024, leading to strong selling pressure. Currently, the strong resistance zone of VN-Index is 1,255 points and the support is the lowest price of 1,218.7 points on July 24, 2024. The developments in the last 2 trading sessions when VN-Index adjusted to 1,209 points and recovered above the lowest price on July 24, 2024, with many stocks under strong selling pressure and recovering well, especially stocks with good fundamentals and good growth in Q2 business results, showed strong fluctuations in these 2 sessions, with many short-term shedding characteristics for speculative positions, high leverage... and opening up many positions to accumulate good quality stocks.

In the medium term, VN-Index has accumulated less positively, as it has failed to maintain the price trend line that has lasted from November 2023 to present, as well as the equilibrium price zone of 1,245 points - 1,255 points of the price channel of 1,180 points - 1,200 points to 1,300 points - 1,320 points. Thereby, VN-Index has shifted to accumulating in the zone of 1,180 points - 1,200 points to 1,245 points - 1,255 points, with 1,200 points being the highest price zone in 2018, 1,245 points - 1,255 points being the highest price zone in 2023. The equilibrium price zone of this accumulation channel is 1,220 points. If VN-Index can overcome the resistance around 1,255 points, we still expect the medium-term trend to return to the accumulation channel of 1,250 points - 1,300 points.

“In the short term, the market started August with a gap in corporate information after the second quarter report was released. Therefore, the market will depend largely on the growth prospects of large-cap companies and GDP growth. Short- and medium-term investors should maintain a reasonable weight, an average level, and consider restructuring to reduce the weight of stocks with business results in the second quarter of 2024 that are not as expected, or that violate the stop-loss level if any, to restructure to leading companies with good fundamentals and good business growth results, exceeding expectations. For new disbursement positions, it is possible to consider disbursing at a reasonable price for leading companies with good fundamentals, based on the second quarter growth results and expectations of good growth at the end of the year,” SHS experts recommended.