I keep seeing and hearing 850 is the SP500 support, and where the market will retrace to. Being able to understand charts and market psychology quite well, I have to say I have no freaking clue as to where these people are getting this number from. (Just like when the gurus were claiming 875 was top line resistance, which I very openly disputed.)
A review of the chart indicates there is some strong support around the current level.
The 62SMA is currently at hand, with a very real buying support within the current market dynamic. (yes, we are still in the same market dynamic we were in last week, prior to this correction)
Now, below this level, we got air. We have no real support from this previous rally to suggest any potential support. If the SP500 breaks the 880 support, a new support will have to be created.
Will 850 be the level to which buyers enter, creating a new support level? Maybe... but why 850?
If we break the current support, while being oversold, IMO, fundamentals may gauge new buyers. When things get too cheap to ignore, with the new mindset of stability, massive buyers will come in.
Unless the overall market will take its que from the Nasdaq, and wait for it to hit firmer support with a more oversold condition. At the moment it looks like it can test 1713 or so.
Whatever the case maybe, valuations have gotten a lot better since (very literally) two weeks ago.