First up is big bank Wells Fargo (WFC - Get Report), a name that's been evolving into a solid trading setup in the last few months. With 8.8% returns since the calendar flipped over to January, Wells isn't just the best-positioned of the big four U.S. banks in 2014 -- it's also the sole member of the group that's not deep in the negative for the year. And the recent price action points to another leg higher in May.
Wells Fargo is currently forming an ascending triangle pattern, a bullish price setup that's formed by horizontal resistance above shares (just below $50) and uptrending support to the downside. Basically, as WFC bounces in between those two technically significant price levels, it's getting squeezed closer to a breakout above that $50 price ceiling. When that happens, we've got a buy signal in Wells.
Must Read: 3 Stocks Spiking on Unusual Volume
Relative strength adds some important backup for a buy signal in WFC. That performance indicator has been in an uptrend since back in November, a signal that this big bank is continually outperforming the S&P in good times and in bad ones. As long as the broad market remains in "correction" mode, relative strength is the single most important indicator you can have in your trading toolbox.