In summary, cash or a "core" bearish position should still be held, but these short-term counter-trend buy signals can also be traded.

"A number of funds have a 60/40 stock/bond allocation rule. Since their stocks got hammered, the 60% has shrunk so these funds will have to buy stock to keep up with their 60/40 allocation, so we could see yet another up day in the major averages before the end of the quarter which would further improve the odds for a short-sale position succeeding, though in this time of crisis, some analysts have said this rule may be lifted."

'In 2008 there were two 20% or better bear market rallies before the market bottomed. In between 2000-2003 there were four, and in 1987 there was just one and it marked the bottom. The Dow is currently up 22% of the lows. The first rally off the 1987 crash lows was 27%.'

Remember to check up by phone on elderly or vulnerable family, friends and neighbors who may need our help.

“To be clear, language like ‘Chinese virus’ is racist...” 
Is it ?
“Put away the race card and get with the last century of naming viruses and flus after their point of origin: West Nile Virus, Zika Virus, Ebola Virus, German Measles, Spanish Flu, Marburg Virus, Rocky Mountain Spotted Fever, Norovirus, Stockholm Syndrome, Lyme Disease” 

The market's main trend is down, so be short or be out, but we're closely watching for the market to get to the point where it can make a successful U turn, produce a short term buy signal and start an oversold rally.

SPY, quarterly view

NOW  
  
"It's a tug-o-war between:

=Super easy money, financial incentives, the low price of oil, and lower taxes
vs.
=Quarantines, corona containment, and damage to the global economy".

"The main obstacle lies in disentangling ourselves from our own emotions."

'The major trend is down. Oversold conditions are at record levels, though, and so a considerable rally could unfold. But I would expect a retest of the lows after that rally fades. The bulls are used to "V" bottoms for the last 7 or 8 years, but that may be changing finally. Wait for confirmed sell signals, and even then don't chase rallies.'

Just a month ago we were posting fresh new all-time highs. The old adage, the markets take the stairs up and the elevator down is certainly evident during the past couple of weeks. The markets have clearly gone from worried to freaking the hell out. Enjoy the ride!

"The biggest drop in oil prices since the Gulf War helped things turn from bad to worse, as the S&P 500 lost 7.6% for its worst showing since October 2008. Within the broad index, financials dropped 10% and energy stocks lost 20% (nothing like a one day bear market), while just nine names finished in the green including Autozone, Inc., Dollar Tree, Inc., H&R Block, Inc., Clorox Co. and Dollar General Corp."

We can't play now, limit down and the market is halted.

Is there any support ?

 $SPX plunged right through the rising 200-day moving average, which was a bit surprising because that usually provides some support on the first test. 

As long as $VIX remains above the 200-day moving average of $VIX, that is a negative for stocks.

"The most important assets that you need to take good care of are you and your family.”

“I will repeat my overarching perspective, which is that I don’t like to take bets on things that I don’t feel I have a big edge on, I don’t like to make any one bet really big, and I’d rather seek how to neutralize myself against big unknowns than how to bet on them. That applies to the coronavirus.  Still, there’s no getting around having to figure out what this situation is likely to mean and how we should deal with it, so here are my thoughts for you to take or leave. In reading them please realize that I’m a 'dumb sh!t' when it comes to viruses, though I do get to triangulate with some of the world’s best experts…As I see it there are three different things going on that are related yet are very different and shouldn’t be confused: 1) the virus, 2) the economic impact of reactions to the virus, and 3) the market action…The virus itself will almost certainly a) come and go and b) have a big emotional impact, which will most likely produce a big whipsaw…Reactions to the virus (e.g., 'social distancing') will probably cause a big short-term economic decline followed by a rebound, which probably will not leave a big sustained economic impact…The world is now leveraged long with a lot of cash still on the sidelines…The actions taken to curtail business activities will certainly cut revenues until the virus and business activity reverse which will lead to a rebound in revenue. That should (but won’t certainly) lead to V- or U-shaped financials for most companies…My guess is that the markets will probably not distinguish well between those which can and cannot withstand well the temporary shock and will focus more on their temporary hit to revenues than they should and underweight the credit impact… Additionally, it seems to me that this is one of those once in 100 years catastrophic events that annihilates those who provide insurance against it and those who don’t take insurance to protect themselves against it because they treat it as the exposed bet that they can take because it virtually never happens…The markets are being, and will continue to be, affected by these sorts of market players getting squeezed and forced to make market moves because of cash-flow issues rather than because of thoughtful fundamental analysis…what’s interesting is how attractive some companies with good cash yields have become…As far as central bank policies are concerned, interest-rate cuts and increased liquidity won’t lead to any material pickup in buying and activity from people who don’t want to go out and buy, though they can goose risky asset prices a bit at the cost of bringing rates closer to hitting ground zero…The most important assets that you need to take good care of are you and your family.” 

The current market could be compered to the August-October 2011 European debt crises market, when an 18% decline was followed by a series of wild swings in both direction.