The biggest questions to ask are 1) what makes these stock charts strong? and 2) what does it mean going forward?  ChartLabPro.com’s algorithms use a quantitative approach that aim to forecast patterns by identifying consistent investment themes. The methodology uses over 200 indicators and scores them to locate trends in their early stages constantly running scenarios to locate inefficiencies and trends in stocks.  Only four of the ten strongest stock charts were in the top ten strongest charts last week.

The current chart shows the year-to-date gains, prices for support and resistance on each stock, as well as an indication of just how strong each 5-rating or “strong buy” on a short-term trend.  The strongest stock charts are never based solely on year-to-date performance but on more recent patterns.  This aims to put the longer-term trends into a better short-term picture for the more active traders out there. The top 10 names on average are up 25.78% year-to-date and up 1.57% month-to-date.  Compares that to the S&P 500 Index with gains of 8.2% year-to-date and a loss of -2.74% month-to-date.

You can click on the chart included here to open and expand it to a larger resolution for easier viewing.

The results here generate visual and contextual results for technical trading analysis and trading opportunities based upon custom criteria for investors.  You can try the Chartlabpro.com for 30 days using promo code Chartp2p8i.

You can also see the five strongest and five weakest technology sector stock charts from the S&P 500 Index here as of Friday.

The 5 strongest charts in the technology sector are as follows: Crown Castle International Corp. (NYSE: CCI); VeriSign, Inc. (NASDAQ: VRSN); Red Hat, Inc. (NYSE: RHT); Intuit Inc. (NASDAQ: INTU); and salesforce.com, Inc. (NYSE: CRM).  These strongest names are up 31.4% year to date against a 8% gain for the S&P 500 Index.

The 5 weakest charts in the technology sector are currently the following: First Solar, Inc. (NASDAQ: FSLR); Electronic Arts Inc. (NASDAQ: EA); SanDisk Corporation (NASDAQ: SNDK); Windstream Corporation (NASDAQ: WIN); and Frontier Communications Corporation (NASDAQ: FTR).  These weakest names are down 22.5% year to date and down almost 10% so far in April.

If you click on the chart and open it the chart can expand on your screen for a larger resolution for easier viewing.

The methodology here generates visual and contextual results for technical trading analysis and trading opportunities based upon custom criteria for investors.  You can try the Chartlabpro.com for 30 days using promo code Chartp2p8i.

In this chart using the ChartLab Pro methodology we are showing the top 5 strongest and weakest energy stocks based on the close of April 16th.  Cumulatively the top 5 names have outperformed the weakest 5 year to date by 28.92% and 12.79% Month to date.   The rankings are not picked by the stocks returns, they are chosen by their technical strength under the ChartLab Pro methodology.

The 5 strongest charts in the energy sector are Williams Companies, Inc. (NYSE: WMB), El Paso Corporation (NYSE: EP), Pioneer Natural Resources Co. (NYSE: PXD), ConocoPhillips (NYSE: COP), and Diamond Offshore Drilling, Inc. (NYSE: DO).

The 5 weakest charts in the energy Baker Hughes, Inc. (NYSE: BHI), Chesapeake Energy Corporation (NYSE: CHK), Cabot Oil & Gas Corporation (NYSE: COG), Southwestern Energy Co. (NYSE: SWN), and Newfield Exploration Co. (NYSE: NFX).

The infographic below is generated by Chartlabpro.com.

The following stocks have exhibited the strongest chart patterns: AutoZone Inc. (AZO); Chipotle Mexican Grill, Inc. (NYSE: CMG); The Home Depot, Inc. (NYSE: HD); Intel Corporation (NASDAQ: INTC); Intuitive Surgical, Inc. (NASDAQ: ISRG); Philip Morris International, Inc. (NYSE: PM); Red Hat, Inc. (NYSE: RHT); Sempra Energy (NYSE: SRE); Unitedhealth Group, Inc. (NYSE: UNH); and Whole Foods Market, Inc. (NASDAQ: WFM).

These names year to date have outperformed the S&P 500 by 12.92%.  During the month of April these particular stocks have risen an average of 0.66% while the S&P 500 has actually fallen by a rate of -3.31%.

As always, past performance is not indicative of future results.  These results for the strongest names are updated daily and stronger names do rotate daily into the composite of the top 10.

Currently the 10 stocks featured this week are not technically overbought, but they are approaching a overbought condition according to the methodology used by the Chartlabpro.com model.

The methodology from chartlabpro.com shows that a 5 rating is considered a Strong Buy and conversely a 1 is a Strong Sell.  As a reminder, Chipotle, Intel, Philip Morris International, and Unitedhealth Group are due to report quarterly earnings in the coming days.

Featured exclusively for 24/7 Wall St. by ChartLabPro.com.

The charts have turned ugly for gold and silver and it bleeds right back to what Carter Worth of Oppenheimer said in mid-March about gold going back to $1,500.00.  Our take is that gold is currently suffering from identity crisis: it is not an inflationary nor a dollar hedge, nor is it proving to be the risk-on asset that investors, traders and speculators had been hoping it was.

Today’s prices on gold and silver matter if you are a pure chartist.  If the prices fail to hold here, gold has another $100 or so in downside and silver could see another 10% easily come out of its still-elevated price.  The iShares Silver Trust (NYSE: SLV) and the SPDR Gold Shares (NYSE: GLD) are experiencing different forms of chart failures right now.

The Gold Trust failed its 50-day short-term test last month and it has now been proving to fail on its 200-day moving average test for the longer-term outlook.  If the GLD does not get a bounce soon, there could be dead air down to $152 or so before technical buyers start sniffing again.

Be sure to see the Stockcharts.com charts below.  The Silver Trust failed its 200-day for longer-term investors back at the end of February and the beginning of March, but its short-term chart was failing at the 50-day moving average back to mid-March.  If this Silver Trust share closes under $30 and hangs out there for long, there is really a bunch of dead air down to $28 or even $27 before technical buyers will start sniffing.

Before you think that the end will never come, Kitco’s Allen Sykora noted today in a longer presentation, “analysts and traders suspect that the market will find some kind of footing before long.”  As we always say, charts matter but they are often corrected by a whole host of excuses as to why they did not work in a particular instance.

The weakness in metals is turning the key gold shares into value traps rather than value stocks.  The $41+ billion dollar in value of Barrick Gold Corporation (NYSE: ABX) is even down 4% at $41.21 and that is $1.00 under its prior 52-week low.  A 4.3% drop in the Market Vectors Gold Miners ETF (NYSE: GDX) down to $46.65 is down $1.40 under its prior 52-week low of $48.05.  And silver is proving to be the devil’s metal for Silver Wheaton Corporation (NYSE: SLW) with a 4.2% drop to $31.30, but its 52-week low does not come into play until $25.84.

This is a difficult time to play a chartist in gold and silver.  The underlying theme is that both metals are weak and could get much weaker.  We usually prefer more fundamental analysis and the fundamental analysis is not supportive either.  If no more easing measures are going to be invented, then the dollar’s rise against the Euro will only help put pressure on gold and other commodities.  And more specifically, investors as of today are not able to successfully claim that gold is a hedge asset nor that it is a risk-on asset worth buying.

Stay tuned.  Maybe silver is not the only devil’s metal.

JON C. OGG

Chart provided by Stockcharts.com:

And sometimes, gold just trades around its charts.  Yesterday we showed how many of the key gold mining stocks were trading at 52-week lows and were starting to look like bargains for patient investors.

Carter Worth of Oppenheimer was on CNBC Thursday night offering some price action in gold by reading the charts.  When it came to gold, Mr. Worth gave a one-word summary that leaves no room for interpretation: “Terrible!”  Worth talked about the 150-day moving average turning down and awful relative strength.  His target as of now: $1,500 on gold.

With it being late on Friday, gold is down about $1.90 per ounce at $1,655.40, so Worth sees another 10% drop in the price of gold.  While he talked about hedging with miners, a 10% drop in gold would likely not help out the Market Vectors Gold Miners ETF (NYSE: GDX) even if it is up $0.05 at $50.19 on a day when gold is down.  If the gold market does go back down to $1,500 per ounce, the same corresponding move would be expected in the SPDR Gold Trust (NYSE: GLD) and it is down 0.3% at $160.80 today.

JON C. OGG

If you adjust for the $0.20 dividend paid out recently, Microsoft shares are up 24.4% (at $32.09) from the end of 2011.  Apple shares are actually up 34%.  Is this huge run over for either company?

If you use the Thomson Reuters consensus price targets as gospel, Apple can still run higher while Microsoft may be reaching full value.  At $543.00 in Apple, the consensus target is about $572.00 but there are calls out there for well over $600.00.  Some guys are even saying $1,000…. The third iPad and Apple TV are the coming catalysts, supposedly.

Microsoft is trading up 1.3% at $32.15 today, but the Thomson Reuters consensus price target for Microsoft is $32.46 now.  The highest target out there is $37.00, and Microsoft’s dividend is now represented at 2.5% for new investors.  If you owned it at the end of 2011 that dividend yield would be over 3%.  The hope is that Windows 8 will truly be a success this year.  To see the performance here, see the stockcharts.com chart below.

The worry here is that analysts may have to start downgrading Microsoft on price target objectives alone.  If not, then the cadre of analysts are going to have to start raising their price targets.

JON C. OGG

Many of the shipping stocks have been recovering in 2012 while the index for the pricing basis (chart at end) has been weak.  Some shipping companies pay out more than they earn and some keep making dividend payments when they are losing money. What we really want to know is if these dividends are sustainable.  There have been some pressures that recently forced one shipper to suspend dividend payments. We have glanced at the following shipping players with recent earnings and/or dividend news: Nordic American Tankers Limited (NYSE: NAT); Alexander & Baldwin, Inc. (NASDAQ: ALEX); Overseas Shipholding Group, Inc. (NYSE: OSG); Euroseas Ltd. (NASDAQ: ESEA); Ship Finance International Limited (NYSE: SFL); DryShips Inc. (NASDAQ: DRYS); and Seanergy Maritime Holdings Corporation (NASDAQ: SHIP).

We also took a look at the Guggenheim Shipping ETF (NYSE: SEA), the shipping ETF, is trying to signal that a turnaround is heading to the shipping sector. This one pays a very sporadic dividend and there is jus not even a two-year history to be able to track how its payments rise and fall through time. Because of uncertainty and pressure, the shipping sector was not a part of the 2012 Model Dividend Portfolio.

Now look at the chart on the ETF.  At $17.99, the 200-day moving average is $18.21 and this has not been anywhere close to the 2300-day moving average since back in April of 2011.  The question is whether this will act as a huge overhang and allow sellers to take profits or if this will be a new bullish mechanism that allows the run from the start of 2012 to continue.

Nordic American Tankers Limited (NYSE: NAT) recently posted a loss and its tax treatment understanding is that the dividend distributions of 2011 should count as a return of capital rather than as income for income tax purposes.  Where the story gets interesting is that earlier this week it posted a wider than expected loss.  It also sold 5.5 million more common shares back in January “to strengthen the Company’s resources, to fund future acquisitions and for general corporate purposes.”  Shares are down close to 10% from when they sold shares to the brokerage firms and the prior payouts have been $0.30 per quarter for a yield of close to 8.6% if it remains static in the quarters ahead.  At $13.93, the 52-week range is $1.58 to $26.18.

Alexander & Baldwin, Inc. (NASDAQ: ALEX) recently lost 7% after reporting lower 2011.  The company saw a weak trans-Pacific ship market after a recent parent split-up announcement in 2011 even forced the company’s Matson unit to shut down its second China-Long Beach service.  Its payout of $0.315 earlier in February at least compares to earnings estimates of $2.06 EPS for all of 2012. At $44.00, this stock only yields 2.8% today and the 52-week range is $33.09 to $55.50.

It was just a week ago that Overseas Shipholding Group, Inc. (NYSE: OSG) in the energy transportation services announced that it had suspended regular quarterly dividends based upon the downturn in international flag markets being deeper and longer than expected.  Unlike other sectors, this company’s management talked about economic uncertainty in the world persisting while banking markets have become more challenging.  The move is to preserve liquidity and the company plans to reassess the dividend as its end markets improve.

A smaller player named Euroseas Ltd. (NASDAQ: ESEA) in drybulk and containerized cargoes had normalized earnings of $0.04 in earnings per share while it declared a quarterly dividend of $0.05 per share as its twenty-sixth consecutive dividend.  It is smaller in market cap at $93 million today, but it listed an average of 16.00 vessels were owned and operated in the fourth quarter with an average day rate of $12,099 per day.

Ship Finance International Limited (NYSE: SFL) is set to report earnings on Friday, Feb. 17 and estimates are $0.38 EPS for the quarter but the estimates are $1.37 EPS in all of 2012 (versus from $1.72 EPS in 2011).  WIth its most recent payout being $0.39 per share per quarter, the company is paying out effectively all or more than all of its income.  Its yield is over 12% if it remains.  At $12.21 today, the 52-week trading range is $8.62 to $21.15.

DryShips Inc. (NASDAQ: DRYS) does not have a dividend, but its shares have skyrocketed and that rally has stepped back up even after petering out a few days ago.  While $3.57 is a far cry from its old highs, this is up over 50% this month alone.  Without a dividend this is merely a sample of how strong the moves can be around any positive news.

A smaller player named Seanergy Maritime Holdings Corporation (NASDAQ: SHIP) in dry bulk cargo is seeing a large gain on tiny volume (with a mere $25 million market cap).  The gain is after positive earnings and a profit, although it said that it expects overall shipping conditions to remain weak in 2012 with new vessel deliveries only contributing to oversupply.

The dividends here are definitely not immune to the woes of the world if they get worse again.  It is worth noting that the stock market has not agreed with the slower economy thesis.  Maybe the rail and trucking sectors are better on a risk-reward metric.  Ultimately, the verdict here remains uncertain and there is still likely to be a lot of volatility around the shipping sector as the globe floats between contraction and a low recovery continuing.

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JON C. OGG

SPDR Barclays High Yield Bond (NYSE: JNK) carries a 7.7% listed yield and is up 0.25% at $39.00 against a 52-week range of $34.09 to $40.93 and it is the primary ETF we look at when it comes to the world of high-yield or junk bonds.  Then there is the iShares iBoxx High Yield Corporate Bond (NYSE: HYG) up 0.1% at $89.69 with close to a 7.7% yield and a 52-week range of $77.90 to $92.85, followed by the PowerShares Fundamental High Yield Corporate Bond Portfolio (NYSE: PHB) that is flat at $18.34 with a yield of about 6% and a 52-week range of $17.00 to $18.76.  You have to consider that the 10-Year Treasury yields close to 2%, but high-yield and junk bonds often pay 7%, 8%, or more.  Here are some of the top closed-end funds, although there are many more out there:

• Blackrock Corporate High Yield (NYSE: HYV): market cap of $396 million with shares up 0.3% at $12.02; 52-week trading range of $10.10 to $12.60; implied yield of 8.5%.
• Pioneer High Income Trust (NYSE: PHT): market cap of $480 with shares up 0.7% at $17.07; 52-week trading range of $14.12 to $18.08; implied yield of 9.6%.
• PIMCO High Income Fund (NYSE: PHK): market cap of $1.5 billion with shares down 0.1% at $12.62; 52-week trading range of $10.52 to $14.88; implied yield of about 8.5%.
• AllianceBernstein Global High Income Fund, Inc. (NYSE: AWF): market cap of $1.2+ billion with shares up 0.9% at $14.47; 52-week trading range of $12.43 to $15.41; implied yield of 8.3%.
• Western Asset High Income Fund II Inc. (NYSE: HIX): shares are up 0.4% at $9.84; 52-week trading range of $8.35 to $10.45; implied yield of about 10.0%.
• Western Asset High Income Opportunity Fund Inc. (NYSE: HIO): shares are up 0.8% at $6.32; 52-week trading range of $5.34 to $6.63; implied yield of 8.0%.

We do advise investors to study the current premium and discount that each closed-end fund trades at compared to the net asset value.  Some are discounts and some are premiums, and these can fluctuate wildly through time for a myriad of reasons.

While that is a composite and while the “BB” is now under 500 basis points over Treasuries, the “B” spread is now under 750 basis points over Treasuries.  Maturities matter here as the longer-dated notes and bonds command higher spreads than most shorter-dated instruments.  Still, this could be the beginning of a wave of continued interest in junk bonds.

What is interesting is that rising yields in Treasuries implies losses on the face value of bonds.  If the yields are rising because of an improving economic picture rather than because of inflation or because of a lack of faith in the underlying creditworthiness of the government, then the bond spreads are likely to contract further and that would drive the interest into high-yield junk bonds.

Be advised that not all junk bond funds are created equally outside of the ETFs.  Some closed-end funds use domestic junk bonds only, while some use international bonds.  Some include foreign-issue sovereign debt at junk levels or trading as though they are junk.  Aslo, some use a bit of leverage while others do not.  The dividend yields are “implied” because ethe closed-end funds pay monthly.

Another caveat needs to be mentioned… Some of the yields on financial quote screens also will differ from our implied yields because we do not include the capital gain distribution that comes with many of these.  They of course count toward your total return, but we like to look at the most recent ‘regular dividend’ when calculating yields.

We have provided a chart for the “JNK” ETF Below so you can see how much this sector has risen since Thanksgiving and then again since the selling climax of stocks and risk instruments (including junk bonds) in early October.

A true chartist would tell you to watch this current level closely.  If prices do not rise from here, it could be representative of a false break-out and that would imply a near-term top.  As long as the “risk-on” mentality prevails, these should do well.  The trick is watching longer-term Treasury yields.  With close to a 2% yield on the 10-Year Treasury Note, investors will seek higher returns as long as those returns are likely to have at least some degree of price stability.  If investors think that Treasury yields are likely to climb suddenly to 3% or even 4%, junk bonds will have some competition from the risk-free trade again.

As you would expect, there is no such thing as a free lunch in the financial markets.

JON C. OGG

The thirteen worst big stock and investor stories in 2011 are as follows: Bank of America Corporation (NYSE: BAC); Diamond Foods, Inc. (NASDAQ: DMND); First Solar Inc. (NASDAQ: FSLR); Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR); Hewlett-Packard Company (NYSE: HPQ); Imperial Sugar Co. (NASDAQ: IPSU); iShares Silver Trust (NYSE: SLV); K-V Pharmaceutical Company (NYSE: KV-A); Market Vectors Egypt Index ETF (NYSE: EGPT); Molycorp, Inc. (NYSE: MCP); Netflix, Inc. (NASDAQ: NFLX); Research in Motion Ltd. (NASDAQ: RIMM); and Sears Holdings Corporation (NASDAQ: SHLD).

Are there others? Of course.  We just wanted to review the worst of the biggest and most easily recognized stories out there.  Some of the explanations and criticisms here may seem a bit raw or overly colorful, but with this motley group what more could you expect…

Read Also: Ten Stocks Unlikely To Survive 2012

Bank of America Corporation (NYSE: BAC) has seen almost everything that could go wrong come its way.  The bank cannot shake the Countrywide mortgage woes, it drove away customers with proposed new banking fees, and it has been under fire by more agencies and regulatory bodies than we can easily count.  The company can hardly get in a settlement that is ultimately not challenged by an outside force. It does not seem like it will get to raise its dividend any time soon and the fear is that perhaps it will need to raise more capital on 2012 stress tests.  This was the worst performing stock out of all 30 DJIA components and not even a Warren Buffett investment managed to keep the stock from falling.  So what if it half of book value now.

Diamond Foods, Inc. (NASDAQ: DMND) became a sample of what can go wrong at a high growth food company.  Eventually the growth peaks and valuations come crashing down.  To go from a growing almond and nut products story to a company buying Pringles did not make sense to many, particularly since Diamond was going to be leveraging itself to make the deal.  Then came the accounting woes around payments to walnut farmers, and that was then followed by a director’s suicide who was inside the accounting woes story.  This was a great story that became very cloudy, just like if I poured a glass of their almond milk that I like so much to try to see through it. After running from about $50 to over $95, shares are now in the low $30-range and shares hit a low of $26.11 recently.  They could have found a rat in the milk vats and survived better than the way things turned out for them in 2011.

First Solar Inc. (NASDAQ: FSLR) went from the U.S.’s solar sector poster boy to perhaps the worst performing S&P 500 stock.  It is still the leader of the solar sector and that is why this one precedes all other solar stock implosions of 2011.  Its CEO resignation or firing came in a rather strange and sudden manner and its prospects do not look much better on the margin front for the next year.  Solar panel dumping by Chinese firms and the negative press of the government backing of the failed Solyndra only added to the fears here as short sellers were able to make a fortune here.  Shares closed out 2010 around $130 and shares went briefly north of $175 in February.  Shares are now around $33.00.  First Solar single-handedly turned many 401/K plans into 201/K plans in 2011.

Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) is one implosion which we debated whether or not should be part of a complaint for the full year.  Its accounting concerns were actually from 2010 and despite the massive share price drop the stock is actually still up for the year.  In fact, shares closed at $32.86 in 2010 and now the stock is around $46.00.  What is so bad is that the stock had been one of the best performing stocks as recently as September and the year high is above $115 for the stock.  Its growth has peaked, its advertising costs are way up, and Starbucks seems to have scored the better end of the deal between the two coffee companies. Because the stock is still up almost 50% for the year, we’ll back off.

Hewlett-Packard Company (NYSE: HPQ) may have started its woes in 2010 after firing Mark Hurd and then hiring Leo Apotheker, the former head of SAP. Still, the baffled decision to even go along with Leo Apotheker’s decision to jettison the PC business was just too much.  And now the decision to keep the PC business seems like it is because the cost of exiting it is just too high.  Palm is now dead too.  The Apotheker decision to acquire the enterprise software outfit Autonomy for $10 billion.  If you overlay a one-year chart as you can see here, you would think that H-P was a bank because its stock tracked the negative performance of Bank of America almost in unison until September.  The verdict is out on whether or not Meg Whitman is right fit here, but frankly the stock has stabilized since she took over.  H-P shares closed out 2010 at an adjusted $41.48 and shares are now close to $26.00 after hitting a low of $21.50.

Imperial Sugar Co. (NASDAQ: IPSU) was looking a lot like a transformation in the making from a sugar company to a sweetener company looking to branch out into new growth markets.  The company even went on a roadshow and got on CNBC to tell its story.  Shares even went from roughly $10 to $25 based upon the hype.  Then over the summer came news of a wider loss and things have slid further from there.  Sadly, it seems that management may have known things were not great when the story changed abruptly and there are class action suits.  Now shares are around $3.50.  This feels like getting drunk at the casino and losing your life savings with the dealers telling you “Thanks for playing.”