SPX Update: Bears Do Their Thing

Last update noted that the last bounce had stalled just shy of the first key overlap, which kept bears in the game, and gave 3470 as the first warning zone for bulls.  SPX sustained a breakdown at 3470, and then proceeded to drop another 50 points to the next support zone.  This puts bulls in an uncomfortable position.  Although I can't entirely rule out a WXY (bullish corrective wave), we probably have to utilize Occam's Razor and favor the most parsimonious explanation, which is that we've now seen a larger impulsive turn (which suggests bears continue to hold the ball for now).

On the hourly chart, bears overlapped their first meaningful overlap, but bulls did manage a bounce at support, which is another reason we shouldn't entirely discount a WXY just yet:

In conclusion, the easiest conclusion is that we've seen an impulsive turn from the gray (2) high (3549), though I wouldn't exactly call that "straightforward" at the moment.  From an aesthetic perspective (and yes, there is an aesthetic to charting), I'm not crazy about the presumed wave 4 of the decline being so much larger the presumed 2, so I'm not able to completely disregard the potential of a WXY.  

That said, we probably have to give the slight edge to bears unless bulls can reclaim that 3549 high.  Be aware that the most bearish outcome of that would mean a retrace all the way back to (and below) 3209.  The most bullish option would be that the decline from 3549 is Wave A of a pending ABC, with a bounce to be followed by another similar-sized leg down.  (And again, everything in the prior two sentences is predicated on this NOT being a WXY decline.)  Trade safe.