Shares of Halliburton (HAL - Get Report) stock surged 9.15% in Monday's trading session, closing at $23.74. It helps that crude oil prices were up on the day, but the price action is mostly being driven by the company's better-than-expected earnings report.

Halliburton reported second-quarter earnings of 35 cents per share, which came in 5 cents per share ahead of expectations. Revenue of $5.93 billion fell 3.6% year-over-year and slightly missed analysts' expectations by $40 million.

The company's international results helped deliver on the bottom line, a similar catalyst we saw for Schlumberger (SLB - Get Report) last week. Halliburton management spoke positively about its international business and pushing forward through the end of the year.

Management's commentary is likely helping to elevate the stock on Monday morning. Shares were up on the headline results, but were not pressing higher this aggressively until the conference call.

It's still early in the day, so it's possible that some of these gains unwind. But as of now, the bounce is bringing up an important test on the charts. Let's examine the price action.

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Trading Halliburton Stock

Weekly chart of Halliburton stock.
Weekly chart of Halliburton stock.

The setup in Halliburton stock is actually pretty attractive. Not because it's flashing a sure-fire buy or sell signal, but because investors have very defined levels in the stock.

Just above current levels, Halliburton stock has a confluence of resistance. First, there's the 10-week moving average and downtrend resistance (blue line) squeezing the stock lower. The latter of the two has been in play for more than a year now, with only a few weeks being the exception in April when the stock briefly broke out.

Second, there's the key $24 level in the way. This level buoyed Halliburton stock in late-December when the market and HAL stock were in free-fall. Since giving way in May, though, this level has been acting as resistance.

The good news? All of these resistance levels come into play around the same level. If Halliburton stock can push through $24, it could trigger a big-time breakout in the stock.

The move on the downside is measured, too. $21 has been support since the May breakdown. So should resistance at $24 keep Halliburton stock in check, investors can look for a potential decline down to $21. From there, either $21 holds as support or it fails and longs can exit the trade with a small loss.

So that's the setup, in a nutshell: We either get a breakout in Halliburton stock on a close over $24 or look for a pullback to $21. If $24 is resistance, nimble shorts could look to ride it down to support. 

This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.