The two men who want to be Wales's first minister are both talking up their prospects, despite dissent.
Negotiations between Labour and Plaid Cymru broke down on Tuesday.
Plaid now faces rebellion from some AMs as it tries to forge a deal with the Tories and Lib Dems, but leader Ieuan Wyn Jones remains confident.
Meanwhile present first minister, Labour's Rhodri Morgan, was bullish, insisting his party had options open, apart from working with the Tories.
No party has an overall majority following the 3 May election.
On Wednesday night, key groups of Conservatives and Lib Dems each held meetings in Llandrindod Wells to discuss the prospect of a Plaid-led coalition.
During its meeting, the management board of the Welsh Conservatives gave its unanimous support to the policy programme for a coalition government in partnership with Plaid and the Lib Dems.
On Tuesday, Plaid Cymru pulled out of talks with Labour which could have helped Rhodri Morgan stay in power.
Mr Bourne said a triple alliance would break Labour's 'stranglehold'
Plaid leader Ieuan Wyn Jones then said he was working towards an agreement for a Plaid-led government with the Lib Dems and Conservatives.
That deal, if it happened, would create the first Conservative ministers in Britain since 1997. It would also give Wales, like Scotland, a nationalist first minister.
But there are considerable hurdles, not least dissent from four Plaid AMs, including health spokeswoman Helen Mary Jones, who oppose the deal.
They have been joined by Plaid MEP and deputy president Jill Evans.
They said working with the Tories would be a "clash of principles and values".
However, Mr Jones said he was "absolutely confident" of securing backing for the tri-party agreement, and the Conservative assembly leader Nick Bourne said on Wednesday lunchtime that his AMs had given "overwhelming support" to the proposal of a so-called rainbow coalition.
In a statement on the steps of the Senedd, Mr Bourne added it was "the only real way of breaking Labour's stranglehold in Wales".
The Welsh assembly is due to nominate the first minister on Tuesday 29 May and it appears that Labour has not given up hope of retaining power.
'Dragging their feet'
Speaking at the Trades Union Congress (TUC) conference in Llandudno, Rhodri Morgan accused the opposition parties of "denial democracy" - and said he was looking forward to creating a coaltion with what he called "progressive forces".
Rejecting working with the Conservatives, he said other parties had no options left other than working with the Tories.
Later, the party published the full details of its offer to Plaid.
It includes a referendum on law making powers by 2011, promising further discussion on the controversial reconfigeration of hospitals and piloting Plaid's policy of providing one laptop per child.
Labour negotiator Jane Hutt said talks were held in good faith with a "clear mission" of providing a stable government for Wales.
"If anyone was dragging their feet, it was the Plaid Cymru leader himself - not us," she said.
Plaid later accused Mr Morgan of "pulling back" on some of the major commitments in the document when he met Mr Jones, including refusing to rule out a moratorium on the hospital review.
A spokesman said: "They failed to come up with an adequate agreed proposal that would have the backing of Rhodri Morgan or his party. Labour's response today smacks of sour grapes."