Vietnam Stock Market May 26: Gradual Capital Allocation Strategy Gains Spotlight Amid Short

Vietnam Stock Market Outlook for May 26: Gradual Capital Allocation Strategy Gains Spotlight Amid Short-Term Volatility

Published: May 25, 2025 | Author: Lac Nan | Editor: Director Jang | Source: Đầu tư chứng khoán (DTCK)

The VN-Index has extended its winning streak for a third consecutive week, closing at 1,314 points. However, reduced trading volume and rising market volatility are fueling expectations of a short-term correction. As brokerages advise, investors should anticipate both mid-term recovery potential and near-term turbulence, adopting a flexible, stock-specific approach and gradually deploying capital. Until a definitive breakout signal emerges, caution is advised—favoring profit-taking, diversified allocation into fundamentally strong stocks, and preparing for re-entry during dips.

Support and Resistance Define a Cautious Upward Path.

AIS Securities noted that the VN-Index gained 7% last week, continuing a three-week upward trend. The slowdown in volume reflects investor caution. The index’s short-term support zone lies at 1,300–1,315 points, with mid-term resistance projected at 1,340–1,345 points. The firm recommends retaining positions in companies with strong earnings fundamentals.

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Wait for a Breakout Confirmation Before Buying.

Vietnam Construction Securities (CSI) emphasized that although the bullish momentum persists, a breakout above 1,343 points with volume surpassing the average would confirm a new upward phase. Until then, investors are advised to hold off on new positions, with 1,250 points seen as a more stable entry point in the event of a correction.

Focus Shifts to Mid- and Small-Cap Stocks Amid Sector Rotation.

VCBS observed capital rotation towards mid- and small-cap stocks, especially those expected to post strong sector earnings. Large-cap stocks, meanwhile, face selling pressure near major resistance zones. Investors should lock in gains where profit margins are adequate, maintain cash reserves, and be ready to accumulate during market pullbacks.

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Overbought Signals Point to Healthy Correction.

Tien Phong Securities (TPBS) warned that the index has entered the 1,313–1,354 resistance zone, with technical indicators suggesting overbought conditions. Liquidity continues to decline, reinforcing the likelihood of a short-term correction. However, MA lines are providing support, hinting at a stabilizing pullback rather than a trend reversal.

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Investor Sentiment Remains Cautious and Indecisive.

VCBS highlighted the emergence of a green doji candlestick and below-average volume at the weekly close, signaling investor hesitation. With technical signals mixed, the market may continue to range-trade or pull back in the near term without a clear directional breakout.

Selling Pressure Builds as Rally Momentum Fades.

Asean Securities pointed to a third consecutive green candlestick, but with long upper shadows indicating increasing selling pressure. While the index remains above the 20-day and 50-day EMAs, the RSI has entered overbought territory, raising concerns of short-term fatigue. There is a 30% chance of a breakout past 1,340, versus a 70% probability of sideways movement between 1,300 and 1,340 points.

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Liquidity Shift and Testing of Support Zones.

SHS Securities warned that the index is nearing its March peak, triggering renewed selling, especially in VN30 and Vingroup stocks. The market may experience downward pressure towards 1,300 points, as demand weakens and investor sentiment grows cautious following recent supply surges.

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Defensive and Value Sectors Take Center Stage.

Asean Securities advises short-term investors to avoid chasing prices and monitor U.S. tariff developments, while long-term investors should gradually allocate capital into sectors less affected by global trade tensions. Banking, securities, public investment, and retail sectors are seen as both defensive and growth-oriented amid heightened market volatility.

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Mid-Term Uptrend Intact, but Short-Term Volatility Persists.

Technical consensus suggests the VN-Index may test the 1,300-point level in the near term, with upward momentum lacking strong volume support. Still, the EMA indicators remain positive, and the medium-term trendline is intact. Until a clear breakout is confirmed, investors are advised to delay new entries, take partial profits, and prepare for strategic re-accumulation on corrections.

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SOURCE

Vietnam Stock Market May 26: Gradual Capital Allocation Strategy Gains Spotlight Amid Short