The most bullish Elliott count was invalidated by undercutting SPX 1428. A higher degree selloff is in progress with the increasingly possibility the recent highs of SPX 1448 is history for the first few months of 2013. For the continuing bear pattern, a close under 1420 will help tremendously. A close above 1425 is the worry point as bulls show they still have some fight left.
Utilizing the alternative DeMark count, TD Combo, the RUT has reached the 13 count but has not been confirmed by the other indices so not everything is overwhelmingly bearish.
An upward bounce is due but should be contained. Still keeping 75% short. If there is a touch at the 1410-1413 area intraday, allocation will probably be at 50% short. 1430 is the stop or if there is a bullish reversal sign.