Market Update [October 26] – VN-Index loses more than 9 points after “bull trap”
On Friday (October 26th), the VN-Index finished with a “bull trap” after experiencing heavy selling pressure in bluechips. In particular, VHM had the most negative impact on the index as falling more than 5%. In addition, bank stocks (VCB, BID, TCB, CTG, VPB, …) all dropped, making the decline worse.
By the closing bell, the VN-Index lost 9.35 points (-1.03%) to close at 900.82. The HSX’s trading volume rose to 160 million shares, worth over 3,200 billion. Foreign investors net bought nearly VND9 billion on the HSX.
In view of technical analysis, the VN-Index’s chart shows a red candlestick called “Black marubozu”, is quite negative. Therefore, we believe that, in a negative scenario, VN-Index will test the nearest support range of 880 – 900, the next support range is forecast at 840 – 860. In a positive scenario, if the index rebounds, the nearest resistance range of VN-Index will be forecast at 920 – 940, at which investors can sell a part of the existing short-term portfolio.. Based on Kelly formula, the recommended proportion of the portfolio is 90% cash/ 10% stocks.
Please see the attached file for more details.