The Sensex opened at 3463, just 2 points down from the previous close of 3465. In the morning session, the bullish tenor was palpable as the index reached an intra-day high of 3516, bettering the previous high of 3484 by 32 points. In the same vein the day's low at 3375 was a gain 38 points over the previous low of 3375. Despite these strong signals the index closed weak at 3409, losing 56 points day over day.

The volumes give a good measure of the profit booking a day ahead of the BSE week end. The number of scrips in advance went down drastically from 639 to 372; advance volumes went down from Rs 1018 crore to Rs 200 crore! The number of scrips in decline went up from 561 to 887 and the volume in decline went up sharply from Rs 156 crore to Rs 1134crore.

With the index closing at 3409, the 12-day exponential moving average is at 3451. The daily stochastic indicator has not turned bearish yet. However, in case the bear pressure continues the next immediate support is at 3312. But more importantly I would draw the investor's attention to the fact that the 200-day moving average is at 3360, which has been slowly rising. Further down you have 3232 as the next support level. The political picture appears to be slowly crystallising. With Jyoti Basu not available to take the mantle of Prime Ministership, the third front is reportedly to be opting for elections. The fate of the BJP's stake with the President is not known as yet.

At best the situation is fluid. The inability of the third front to find a prime-ministerial candidate could have upset the market sentiment. On the other hand the budget has been passed and the final word from the President has not been heard.

But a scan across the Sensex scrips show that the Sensex has sufficient support tostay buoyed around the current levels. Unless desperation strikes marketmen, of which there is no sign as of now, the scope for the downward movement of Sensex appears limited.