as far as i know if you have www.abc.com and setup a subdomain say np.abc.com the sub domain will need to point somewhere, as it asks you upone create i think.
If i understand you correctly: domain www.abc.com redirected to subdomain: www.xyz.abc.com so typing www.abc.com redirects to subdomain. Yes, you can do it (at least in cPanel) without any problem.
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