IndusInd Bank charts suggest more weakness ahead

On Monday, the stock of IndusInd bank Limited gave an upward sloping trendline breakdown on the daily chart. This breakdown was supported by a relatively higher volume. Additionally, the stock had also formed a sizeable bearish candle on the breakdown day.   

Along with this channel breakdown, the stock, after a span of over two months, closed below its crucial short-term moving averages i.e. the 50-day EMA. The stock is also trading below its weekly pivot level.  

Interestingly, the RSI has given head & shoulders-like pattern breakdown on the daily chart. Besides, the 14-period daily RSI is currently quoting at 37.48. The RSI is trading below its 9-day average and it is in a falling mode. The momentum indicator i.e. the MACD line has recently crossed under the signal line, which resulted in the histogram turning negative. Further, the direction indicators have seen a bearish crossover as -DI has crossed over +DI.  

Going ahead, the zone of Rs 825-Rs 814 is likely to act as a support for the stock as it is the confluence of 38.2 per cent Fibonacci retracement level of its prior upward move (Rs 571-Rs 983) and prior swing low. A sustainable move below this zone would invite further selling. On the upside, resistance is seen in the zone of Rs 911-Rs 930 levels.    

On Monday, the stock of IndusInd bank Limited closed at Rs 849.15 per share, dipped by 4.94 per cent. The stock opened at Rs 906 per share and hit an intraday high of Rs 912.35 and a low of Rs 839.20 per share on NSE.