The market opened with the Sensex at 2804, and moved up to post a high of 2822. This was 11 points higher than the previous high of 2811. However, profit-booking did not dent the low for the day. The intra-day low was at 2790, a good 48 points over the previous low of 2742. The market closed with the Sensex at 2811.

HPCL proved to be a great pull back for the index. The scrip which had stabilised on Monday and looking set to move up at Rs 243, suddenly gave way and dived down to Rs 228, closing at Rs 231. There was an explosion in volume to Rs.8.9 crore, compared to Rs.3.5 crore on the previous day. Oversupply of PSU stocks, especially from institutions could well be the reason according to Arun Ganguli of Anand RathiSecurities. The scrip has come to rest on a technical support and therefore could bounce back. The scrip is oversold and the stochastic indicator in the daily chart is still in the buy mode. Bharat Petro, and Cochin Refineries too did decline. Cochin Refineries could bounce at Rs.122. Both at Bharat Petro and Cochin Refineries the stochastic indicator is still indicating a buy.

The Sensex has come up against a technical resistance point at 2808. Though it pierced this upwards to post an intra day high of 2822, it closed at 2804.

Looking at several scrips, there is a good chance for the index to break the resistance and move up. At the first leg it could reach up to 2842. But at full steam the target could easily be 2880. The daily stochastic indicator is in the buy mode. It is difficult to consider today's performance as a weakness. It was a case of consolidation and the market has the technical potential to resumme its advance on Wednesday.