S&P500 50% retracement from 2007 high to 2009 low (TheBigPicture)

S&P500: 50% Crash Retracement

 

By Barry Ritholtz - August 3rd, 2010, 12:00PM

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I was speaking to our head trader earlier this week, and he pointed out that for the 5th time since the market bottomed, we have hit the 50% retracement line.
From the October 2007 SPX highs of 1576, to the March 2009 lows at 666 — a drop of 710 points. SPX 1121 makes up exactly half of those losses.
The key question is how much strength do markets have? That 50% retrace worked off nearly all of the oversold conditions from the crash.
That does not mean we cannot grind upwards from here; it just means that its going to take a lot of something— good earnings, liquidity, sentiment, breadth, momentum, psychology, quantitative easing, something – to move higher from here . . .