Bull Chart of the Day -- Precision Castparts Could Be Building a Win Streak

NEW YORK (Real Money) -- Even though 2015 hasn't been full of shock and awe thus far, there have been plenty of winners. It's true that we've seen some bigger names get hit hard early, which feels like a departure from the last few years. Some of those names seem to be turning here such as Precision Castparts  (PCP), and these may be the opportunity types of play for the summer.

PCP has a very rough start of the year, falling from over $240 to under $190 in the first few weeks of trading. After a decent bounce, price has been trading between $200 and $220 -- a fairly wide but very consistent range. Lately, there has been a little change to the price pattern, with the range tightening between $200 and $210.

Friday, the stock shot out of the ascending triangle price pattern with volume and pushed into longer-term resistance as per the daily chart.

Today, we are testing that resistance again. I don't expect us to push right through it, but a day or two trading over $212.50 and into the $216 range should be seen as bullish, especially with the increasing volume.

The RSI and slow stochastics spiked along with price, so we are seeing pushes in volume, price, momentum and trend. This makes for a more attractive bullish stance.

Pushing out to the weekly chart, we can see the trading channel more clearly.

The challenge here for the bulls is the resistance, not only at $215.75 but also around $220. Still, there is good potential here. The slow stochastics has already pushed higher in bullish fashion. The RSI is hovering just above 50, so we absolutely want to see that hold for the week.

Note the volume fell off between February and April after the stock sold down. Then, we have a big volume spike as the stock tested support, but we held. This looks to me as if sellers became exhausted, so the bulls have a chance here. I like a small play here with an additional buy over $222.

The upside target here sits at those December highs around $240. If this stock were to close under $200, it moves from a long to a screaming short, with a minimum target of $180. It's a great one to keep on the radar as it has breakout trigger potential, a trading channel range potential as well as a potential short trigger and all of this just based on the patterns already in place.

In other words, we don't need any more information other than price action. For now, I'm siding with the bulls and taking in some long stock exposure.

Editor's Note: This article was originally published at 10:39 a.m. EDT on Real Money on May 18.

This article is commentary by an independent contributor. At the time of publication, the author was long PCP.

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