Market Update [May 15] – VN-Index tops 970 after rising over 10 points
On Wednesday (May 15th), the VN-Index traded on a positive note, and closed at its highs of the day. Particularly, most of large caps rallied, contributing significantly to the rally of index. In addition, the market-sensitive stock groups such as banks, securities and real estate, also had good performance, creating positive sentiment to the market. By the closing bell, the VN-Index added 10.30 points (+1.07%) to close at 975.64. Trading volume was nearly 190 million shares, worth VND4,200 billion. Breadth was positive, with gainers topping losers 198 to 97. Foreign investors net sold VND200 billion on the HSX, mainly in VHM.
In view of technical analysis, the VN-Index’s daily chart shows a long green candlestick, and breaks out the resistance level of 968, or MA20, while the RSI rises above 50, which are the signs of positivity. Therefore, we believe that, in a positive scenario, the VN-Index will test the nearest resistance range of 980 – 990, at which investors can sell a part of the existing short-term portfolio. In a negative scenario, the nearest support range of VN-Index is forecast at 960 – 970, the next support range is expected at 940 – 950.
We recommend investors should not buy at high ask in this period, and consider reducing stock proportion in strong gain sessions, especially when the upper trend line of the descending triangle pattern has not been broken. Based on Kelly formula, the recommended proportion of the portfolio is 70% cash/ 30% stocks.
Please see the attached file for more details.