A lot has happened since my last EW update - the SPX broke 1440 which invalidated my medium-term bullish count and turned me medium-term bearish.
Not only medium-term but also long-term I'm less bullish than I was a few weeks ago. Since more than two years I've been calling for new all-time highs. Now, after the SPX almost hit my target, it looks like we might not quite get there.
Despite the 10 % decline so far from the highs not all hope is lost for the long-term bulls though. If you look at the weekly chart of the SPX above you can see that such sell-offs happened quite often during this bull market. Another interesting point is that none of these declines (except for the one in mid 2010 for a few days) undercut the low of the previous decline. So basically we got a series of higher highs and higher lows.
For this reason I think one should have a bullish to neutral bias until 1270 is convincingly broken. Once below it, I think the likelihood of a new bear market is very high. I'll address potential target for a bear market in one of my next updates.
It looks like we're in a second wave. My preferred target is 1407ish. If we rally above 1435, this count is most likely wrong (also the long-term count posted above!) and new highs are likely.
To sum up, I think the situation looks bad for the bulls but not hopeless. It's similar to the decline in April/May and, well, you know what followed. So it's still possible that this is just another correction within a bull market. Thus we have to closely observe what happens in the coming weeks.