This is the S&P level traders are talking about now

A new level is obsessing traders: 1,950.

Many describe that as the S&P 500's "line in the sand" — the Rubicon across which stocks must cross before traders become confident that the worst of the recent market rout is over.

"I keep hearing over and over again that 1,950 in the [S&P] is inevitable," Michael Block, chief strategist at Rhino Trading Partners, wrote Thursday. "Some folks say that's their point to take profits/fade but others are saying that's where the coast is clear and they start buying."

It's not just that 1,950 is an easily remembered number. The level has frequently served as an intraday turning point for the market.

In an extremely volatile session on Aug. 25, the S&P 500 rose as high as 1,948 before turning back around to close at the lows; the high the next day was 1,943.

After a few more dramatic moves across the 1,950 line, the S&P 500 surged on Oct. 2 to close at its high tick of 1,951. A decisive move above that level in the next session set the market up for a sweet rally over the next month.

More recently, the S&P 500 found its session high at either 1,947 or 1,950 on Jan. 12, Jan. 13 and Feb. 1.

At this point, a break above 1,950 appears to be what bulls are pinning their hopes on.

In a Friday morning missive, Raymond James' chief investment strategist, Jeff Saut, complained that "we didn't quite make it to the envisioned 1,950 level," which "brought on questions" about whether the market's recent "selling stampede" is over.

Either way, traders certainly appear to have become increasingly technical-minded of late. The last "key level" was 1,812, which was lauded as the market's potential low.

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To Boris Schlossberg, managing director of FX strategy at BK Asset Management, this is a symptom of the market being "fundamentally uncertain."

"That's why we need to see those prices higher in order to have that conviction that prices are going higher," Schlossberg said Thursday on CNBC's "Trading Nation."


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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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