Nifty has now closed below a very important support of 2700. This was the level which was holding out despite negative global cues and bad news around. Somehow, Nifty always managed to closed above this level.
Now on Tuesday, 27 January, Nifty will try to again close above 2700. However, global cues and monetary policy can spoil this party. A very important support exists for Nifty at 2650. If there is news of rate cuts in the monetary policy, Nifty will easily surpass 2700 and close above it. However, If there are no positive cues in the monetary policy, expect 2650 to be broken and a close of Nifty near 2600 levels (Then 2550-2500).
Our personal view is that chances of rate cuts in this monetary policy are slim, as also indicated earlier by the RBI and Govt. Safe traders should avoid trading until the monetary policy comes out.
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