BALTIMORE (Stockpickr) -- We're in correction mode to start the week -- unfamiliar territory for 2011 to be sure. Yesterday, the S&P 500 slid 2.05%; the more-volatile Nasdaq tumbled 2.74%. Those are hardly small pullbacks, particularly given the market's predilection for gains in the trailing six months. But bulls should be applauding, not quivering.

That's because the magnitude of the S&P's gains make a 2%+ correction less a bad omen than a healthy "breather" for stocks. I've long held (in 2011) that 1,300 is the key level to watch for the S&P 500; with the major index still sitting well above that price, traders would do well to continue thinking "rally mode."

Meanwhile, we'll seek out the best potential trades this week by turning to a new set of technical setups.

Related:

Making Sense of Moving Averages

Remember,

technical analysis

is a way for investors to quantify qualitative factors, such as investor psychology, based on a stock's chart patterns and trends. Once the domain of cloistered trading teams on Wall Street, technicals can help top traders make consistently profitable trades and can aid fundamental investors in better planning their stock execution.

Here's a look at

this week's potential trades

.

Peabody Energy

Peabody Energy

(BTU) - Get Report

has made a strong run in the last year; shares have gained nearly 34% during that time. Although the upward moves in BTU have tapered off since December, there's still reason to bet on continued upside in this stock. It's all thanks to one of the most predictive patterns out there.

Shares of BTU have been forming a bullish ascending triangle pattern for the last several weeks, a bullish pattern that's among the most effective in spotting potential upside trades. With the pattern's upside resistance at $66, that price level is the number that shares will need to crack before the setup becomes a buyable play. Don't trade BTU until that happens.

That's because, like most technical setups, a potential trade is just that until it triggers. In the case of an ascending triangle, that trigger happens on a confirmed breakout above upside resistance. If you decide to take on this trade, I'd recommend putting a protective stop around the $64 level.

Boardwalk Pipeline Partners

With a hefty 6.39% dividend yield right now, it's should come as no surprise that

Boardwalk Pipeline Partners

(BWP)

is a favorite of income-seeking investors. But there's plenty of reason for traders to be paying attention to shares right now as well.

That's thanks to a bullish cup-and-handle pattern forming in shares of this $6.27 billion natural gas pipeline play. At present, BWP is nearing its $33 resistance level, a setup suggesting that if a breakout is going to happen, it'll be soon.

One of the hallmarks of a cup-and-handle pattern is a minor pullback after the "cup" is formed, where bears fail to send shares back down to previous resistance. As such, investors shouldn't be concerned if we see a bounce lower off of $33 as long as it makes a relatively quick reversal back to resistance.

As with the ascending triangle in BTU, the breakout above resistance is a prerequisite for taking the trade in BWP. Until that confirmed breakout above $33 happens, you're not looking at a "high probability trade".

Crown Holdings

A completely different pattern is showing up in shares of consumer packaging manufacturer

Crown Holdings

(CCK) - Get Report

. Essentially, shares of CCK are forming a channel up, an upward move where price action is banded at the top and bottom by trendlines. With shares consolidating up toward trendline resistance, this stock could be attempting to accelerate its climb by breaking above the upper blue line.

But more likely is a fall back down to

trend line support

. As a result, we've got a nice example of an if/then play in CCK: A slide below $37 means that CCK is a good short play (in the very near term), whereas the break above the upper blue line means that it's time to go long. Either way, keep a protective stop just on the opposite side of the upper trend line to avoid getting caught by unexpected price action.

To see these plays in action, check out the

Technical Setups for the Week portfolio

on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.

RELATED LINKS:

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At the time of publication, author had no positions in stocks mentioned.

>br/>Jonas Elmerraji is the editor and portfolio manager of the

Rhino Stock Report

, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including

Forbes

and

Investopedia

, and has been featured in

Investor's Business Daily

, in

Consumer's Digest

and on

MSNBC.com

.