Technical Analysis: ABB India, Aditya Birla Capital and HDFC Bank

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ABB India (₹4,100.35)

Trend turns bearish

ABB India’s stock is on a long-term uptrend. But since July, it was consolidating within ₹4,200 and ₹4,560. But the recent downtrend, which began on the back of the resistance at ₹4,560 a couple of weeks ago, possessed enough momentum to drag the stock below the support at ₹4,200. This has turned the outlook bearish for the stock.

The chart indicates a potential fall to the support band of ₹3,600-3,700. That said, there might be a minor rally to ₹4,300 from here before the fall. Hence, initiate fresh short position now at ₹4,100 and also if the price rises to ₹4,300. Place initial stop-loss at ₹4,450. When the stock falls below ₹3,900, tighten the stop-loss to ₹4,050. Book profits at ₹3,700.

Aditya Birla Capital (₹179.95)

Charts a falling channel

Aditya Birla Capital’s stock is on a long-term uptrend. However, since the beginning of July, the price has been on a descend. Notably, the price action is tracing a downward channel. This indicates that the short-term trend is bearish and more corrective decline is on the cards. The bears could pull the price down to ₹160, a strong support in the short term, from where we might see a rebound.

The short-term trend will be negative as long as the price stays below ₹185. Traders can short the stock now at ₹179. Add more shorts if the price moves up to ₹182. Keep a stop-loss at ₹186 initially. When the stock slips below ₹165, modify the stop-loss downwards to ₹171. Exit the positions at ₹160.

HDFC Bank (₹1,526.55)

Breaks down from a range

HDFC Bank’s share price has been flat since November last year. It was largely oscillating between ₹1,560 and ₹1,700. However, the stock faced considerable selling pressure and it closed at ₹1,529.65 for the week ended September 22. Thus, it decisively breached and remains below the support at ₹1,560, opening the door for further depreciation.

From the current level, the price is likely to decline to ₹1,420. But there could be a minor bump in price to ₹1,570 before the next downswing. So, short HDFC Bank now at around ₹1,527. Add more shorts if the price inches up to ₹1,570. Place initial stop-loss at ₹1,615. Post a fall to ₹1,470, alter the stop-loss to ₹1,510. Exit at ₹1,420.