Market Update [June 12] – VN-Index loses 960 after falling nearly 8 points

12/06/2019 16:29

Report: Market Update

On Wednesday (June 12th), the VN-Index traded on a negative note, and closed at its lows of the day, highlighting the poor performance of large-cap stocks. By the closing bell, the VN-Index lost 7.90 points (-0.82%) to close at 954.17. Trading volume was nearly 140 million shares, worth VND3,900 billion. Breadth was negative, with losers topping gainers 181 to 110. Foreign investors net sold VND28 billion on the HSX, mainly in VHM.

In view of technical analysis, the VN-Index’s daily chart shows a long red candlestick called “Marubozu”, and loses the support level of 967, or MA200, while the RSI moves down to 30 – 40 range, which are the signs of negativity. Therefore, we believe that, in a negative scenario, the VN-Index will test the nearest support range of 940 – 950, the next support range is forecast at 920 – 930. In a positive scenario, if the index rebounds, the nearest resistance range of VN-Index will be forecast at 960 – 970, at which investors can sell a part of the existing short-term portfolio.

We recommend investors avoid bottom fishing, while keeping a low stock proportion in order to minimize risks if the support level of 940 – 950 continues to be broken. Based on Kelly formula, the recommended proportion of the portfolio is 90% cash/ 10% stocks.

Please see the attached file for more details.