Nifty: Monetary policy holds mkts

After a week's strong up move, Nifty traded with negative bias and closed in the red for 4 out of 5 days of the week and closed with a loss of more than 1 per cent for the week. In view of the event of RBI policy, market can be expected to remain cautious ahead of policy. Expose of money laundering activities of certain private banks are also likely to have its effect on the sentiment. Advance tax payments which generally appear encouraging will have stock specific effect. Technically, Nifty is in neutral zone for short term and gets into bullish zone above 5970 and into bearish zone below 5850. Further, strong resistance is also seen around 6000 for Nifty. Hence, caution is advised at higher levels. Unless, strong positive action is seen after RBI policy, 6000 level may not be crossed. Though, Nifty rose from lower levels, mid cap stocks, which had fallen sharply are yet to recover reasonably and in respect of these stocks, top could be in place and they might drift lower once again after reasonable retracement. Short term traders need to be ever vigilant tracking short term movements and investors with medium and long term outlook can invest in quality stocks on SIP basis. For the coming week, Nifty spot is expected to face resistance at 5950, 6025, 6105 and find support at 5995, 5720, 5645. Nifty is in neutral zone and gets into bullish zone above 5970 and into bearish zone below 5850. However, strong resistance too is there around 6000 and caution is advised at higher levels. Advice for Traders Outcome of RBI policy holds the key and strong resistance is seen around 6000 above which level only further upside can be expected. On the other hand, if Nifty slips below 5850 on close basis, further fall too can be expected. Hence traders are advised to remain cautious at higher levels.