Obama was actually leading in Iowa in a recent poll, 26% to 23% for Hillary and Edwards. He's doing all right in South Carolina, and if he wins the black vote, could win there. (Though Hillary's actually improving her numbers more quickly than Barack and leads 42-28%.) He's getting killed in Nevada (37-17%) and holding his own in NH (33-25%). I'm skeptical about the NH numbers though--I expect Clinton to win that one handily. So, can he rally?
Charles Franklin at Pollster has tackled the question based on polling. Shorter version: things could be better.
[Obama] had a rapid rise to 23% by April 1 and it was nearly impossible to read a news article about him during this period without encountering the phrase "rock star". But perhaps he was a "one-hit-wonder" because since April 1 there has been no further upward movement in his national support. If anything there has been a negligible decline to a current estimated support of 22.6%.
The Clinton campaign also experienced a long period in the doldrums. After entering 2006 at about 37% support, Clinton declined slightly to 35% just after the November elections.... That began to change by early June [this year] and has accelerated a bit since. My best estimate of Clinton's current support is 38.8%, a rise of nearly 4 points since the end of April. That four point rise won't sound like much to those accustomed to the noisy variation from poll to poll, but the trend estimator I use has the advantage of aggregating across many polls and hence has a much smaller range of random variability. A move of this much is certainly not negligible.
The arguably bigger problem is that Clinton's poll trends are all up in the five early states (though there have only been six polls in Nevada). Obama is up in South Carolina, a little in New Hampshire, but is down in Iowa and Florida (again, no real trend line in Nevada).
So, is Obama screwed? The answer is "probably." But he has a few months left to show improvement in the early states. Otherwise we move to "almost certainly."