Flip It: Getting a clue about chart reading

Good morning and welcome back to the hit parade, where many of the DJs are paid to put the songs they play on rotation.

All right, I’m back from marrying off my brother in Austin this weekend to a lovely bride. I used to tell my TV show viewers all the time that the only thing permanent in life is family. Spend some time with and respect your family.

Here’s the chart of the day:

When was the time to sell?

That chart comes from Reuters I added a question there as the caption because it’s the key to the whole set up right here right now in regards to Europe and the EU and Spain and their endless bailing out of the banks over there like we keep doing over here but more stealthily.

I know the mainstream media wants you to be freaking out and a lot of advisors are panicking out of their longs. But before you listen to those people, I’d ask you to ask yourself what were those guys saying back in 2007 when the markets were at their highs and THE TIME TO SELL EUROPE HAD NEVER BEEN BETTER?

I make many mistakes, as you guys know, but long-time readers can tell you that two of the greatest calls of my career were when I launched a technology-centric hedge fund in October 2002 with the Nasdaq just twelve days from bottoming after a record 75% drop. And then when turned bearish and closed my hedge fund at the top in October 2007 — in large part because of charts like that Spain retail sales and confidence charts hitting those all-time highs and the bubbles around the world looking ripe to pop. Here’s some of what I was writing about at the time in my trading diary at TheStreet.com:

Short Confidence in Long-Side Bets 04:23PM 08/22/07 By Cody Willard This isn’t the time to be long.

Weekend Vittles: PC to Replace Credit in Your Pocket 03:55PM 07/27/07 By Cody Willard By any measure, even with the iPhone numbers, Apple’s report this week was impressive.

Caution’s Key for This Part of the Cycle 03:52PM 06/12/07 By Cody Willard Interest rates and other reasons to get bearish.

Internet Video vs. Cable Companies 03:07PM 06/11/07 By Cody Willard Apple’s iTunes video rollout is just beginning.

Of Pairs Trades, Pumps and a Deflating Consumer 04:25PM 04/09/07 By Cody Willard Matching short ideas with longs will be the order of the next session.

Wait to See the Whites of the Fed Cut’s Eyes 02:45PM 03/26/07 By Cody Willard The current housing problems are going to cast a wider net and we should listen for the trumpets that sound the sell call.

Avoid Chasing the Pop 09:02AM 03/19/07 By Cody Willard Overnight strength in overseas market propels the optimism.

So my question to you again is — when was the time to sell Spain and the EU? Probably back at the top of that retail sales and confidence chart when the headlines were screaming about how great the economy is booming in Spain back in 2007.

It’s time to be a buyer, not a seller if you’re looking at Spain’s economy and/or the EU’s crisis as a catalyst. Buy when there’s blood in the streets. Sell to the sound of trumpets. There are no trumpets playing in Spain or the EU economy right now.

Will I put up an updated Spain retail sales and confidence chart in three years with the caption “When was the time to buy?” Think about it.

Flip it.