Chart Busters: Top trading set-ups to watch for Monday

The Indian benchmark indices have been witnessing severe selling pressure. Nifty closed at its lowest level after July 30, 2021, as the current fall is severe and steeper than earlier swings.

The first downswing in the current downtrend is 42 sessions and an 11.9% fall, while the second swing took 33 sessions for a 14.5% drop. But the current downswing is 13.9% and it took just 15 trading sessions. Interestingly, the upswings are short-lived and consume almost half of the time of the downswing. As Thursday's low reaches the previous major swing, there is a probability of the 15671-level acting as support. The broadening triangle's support is placed near 15150. And the current swing's Fibonacci extension support is placed at 15290, which is a 161.8 per cent extension level.

Generally, the steep and sharp trending moves will undergo counter-trend consolidations for a week and then it’s likely to resume the downtrend. The fact is that the Nifty is moved far away from the short-term average. The price has to pull back the 20DMA sooner or later. At the same time, the Nifty is below the lower Bollinger band, and both the upper and lower Bollinger bands are steeply in a downtrend. The index is yet to make the lower low, but the lower band has already declined below the previous low. This tendency leads to one or two days of indecisiveness or smaller pullback moves.

The immediate support Nifty is placed at 15671 and immediate resistance is placed at 16000 followed by 16300. It is reiterated that one must continue to stay highly stock-specific in approach and adopt a positive but cautious outlook towards the markets for the near-immediate term.

ACC: The stock closed at very critical support and there's a news flow into the market, so let’s wait for its reaction. Technically, it closed at the rising trendline support and formed a bearish, engulfing candle. The 20DMA is in a downtrend, and the price is below all key moving averages. The MACD line is just on the zero line, whereas the RSI is below the 40 zone and below the prior swing low. The -DMi is above the +DMI and ADX. The volume is higher than the previous day. The Elder impulse system has formed a series of bearish bars and the TSI and KST indicators are already in bearish mode. In short, the stock is at critical support. A move below Rs 2101 is negative, and it can test Rs 2025. Maintain a stop loss at Rs 2145. But, at the same time, a move above Rs 2163 is positive, and it can test Rs 2200. Maintain a stop loss at Rs 2140. Avoid if it opens with a huge gap on either side.

PETRONET: The stock closed just on the moving average ribbon support. It decisively closed below the 20DMA and 50DMA and formed a dark cloud cover candle. It also closed at the upward channel support. The MACD has given a fresh sell signal, while the RSI is below the prior swing lows and below the 50. The -DMI is above the +DMI is negative. It is also below the Anchored VWAP support. The Elder impulse system has formed bearish bars, whereas the TSI indicator has given a fresh sell signal. In short, the stock closed at very crucial support.