Market volatile; 5700 level crucial: Udayan

Udayan Mukherjee, managing editor, CNBC-TV18, says that today the market has been a bit volatile. There are some people in the market who have seen a good rise and are sitting on profits and therefore they want to preserve profits particularly in a scenario where the global markets are becoming slightly iffy.

There are some question marks over Europe, people are fretting about the fiscal cliff and therefore some people want to take some profits after the ride because the rally has been quite sharp.

Equally, many people were not able to participate in this rally and therefore whenever the Nifty slips 100-150 points, many people want to buy on dip. A scenario where there are buyers and sellers typically leads to some volatility and that is what we are witnessing at this stage.

But today if the market closes below 5700, then it might be a slightly disappointing outcome for the near-term trader because in the morning we started with a gap up but we have failed to build on that during the course of the day which is not a great sign for traders. Nothing has happened in the last two days to vitiate the medium-term uptrend and we can start questioning that only when we come to levels like 5550-5600.

With this kind of a shallow fall it's too early to start fretting about whether the uptrend has come to an end. But some volatility and some near-term profit taking is happening and I think it is not such a bad thing to given the ferocity and the sharpness of this rally.

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