The seemingly never ending “Greek Crisis” has certainly garnered the world’s attention over the last couple of weeks. And while market volatility has certainly increased as of late, it is important that we step back and look at the markets objectively. As I stated very early last week, as Greece defaulted on their debt payment to the IMF:

“if we step back from the media’s messaging and take a look at the market, a significantly different picture begins to emerge. The chart below is a monthly chart of the S&P 500 index.”

“When put into some perspective the recent “decline” is much less dramatic. Importantly, the markets continue to maintain the longer-term “bullish trend” which has been the hallmark of the market’s accelerated advance since the onset of “QE3” in December of 2012.

Importantly, for investors, the TREND of the market remains positively biased for now. Regardless of your personal bias (bullish or bearish,) as it relates to the economy or markets, the positively sloping market trend requires portfolios to remain tilted toward equity (risk) based exposure.

However, and importantly, where investors inherently go wrong is the extrapolation of the current condition indefinitely into the future. As shown in the chart below, there are internal dynamics that suggest that current “environment” for carrying excess “risk” is deteriorating.”

“The market, on multiple levels, has reached points that have existed only at previous major market peaks. Furthermore, the internal dynamics are issuing very similar warnings, in terms of momentum, deviation, and relative strength, as to what was seen just prior to major turning points previously. While this does NOT mean that the market is on the verge of immediate mean-reverting correction, it does suggest that future market returns are likely to be far less robust than what has been seen previously.”

….. read more HERE