Only One S&P 500 Stock Survived the Coronavirus Panic; Palladium Update and 1998 Scenario

Looks bearish below resistance.

One stock that did hold up well was $NFLX. I think it's overvalued, but if the market rallies off the lows...plus Netflix is one of the companies in a position to benefit from coronavirus, or at least not suffer from it.

Zoom Video Communications (ZM) was another one that should benefit and it tanked on Friday.

It feels weird taking a bullish view amid the mayhem, but I still think palladium could tag that resistance line. At least, I can't rule it out yet. If anything the dip extends the time frame to a top. At the pace it was moving the last couple of weeks, it could have topped next week had markets kept rising.

Finally, the 1998 scenario isn't dead. I first discussed it on the day the market bottomed in 2018: What a Tantrum, Is 1998 in Play? To be clear, I didn't follow my own advice. But I did consider the possibility. I fleshed it out in March: 1998 Scenario Still in Play. The "market top" pattern I post from time to time supported a 1998 interpretation.

And I discussed it again in May 2019, at which time I did go short and did well for myself, but would eventually give some back because I didn't expect the Fed melt-up from October 2019-February 2020. 1998 Redux: Bonds Not Behaving Yet, 1966 Rising? Bonds remains a clear difference in the overall 1998 scenario, since rates rose into the market peak. Commodities such as oil, copper and palladium support the 1998 scenario.

The best case scenario is coronavirus fades like SARS. In this case, the market has already overdone it with selling. (Doesn't mean the low is in.) The U.S. sees a temporary economic boost, the government stimulates too much, markets melt-up to a final all-time high. Another possibility is February is the high as in March 2000. Sectors such as airlines are already in a bear market and while the S&P 500 or Nasdaq rally back near their highs later this year, they never make a new high.

Finally, for the immediate future, I am net long heading into Monday. My holding period has gone from months down to days and hours though. My largest position is short TLT, long XLE and QQQ. I don't plan on holding these for long whichever way they move. This market is becoming too volatile for all but the nimblest (shortest time-frame) traders. I will head towards cash and wait for a major support to hold or fail, or for a signal such as the market failing to drop on negative coronavirus headlines.

Update: Chinese traffic congestion is down this weekend, but that's to be expected. A recovery in work-week traffic is the bigger indicator for now. When weekend traffic rises, we'll know the corner has really been turned.