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Companies are spending on data centers again -- and that's proving a very good thing for Applied Materials (AMAT) - Get Applied Materials, Inc. Report .

Analyst upgrades are streaming in for Applied Materials on the heels of strong earnings results from Intel (INTC) - Get Intel Corporation Report and Lam Research (LRCX) - Get Lam Research Corporation Report , sending the shares rallying this week. AMAT was raised by analysts at RBC and Craig-Hallum, prompting a nearly 9% move higher.

And there could be more upside where that came from.

That's because, from a technical standpoint, yesterday's jump hurdled the shares above a key price level. To figure out how to trade shares of Applied Materials from here, we're turning to the charts for a technical look.

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At a glance, it's been hard to miss AMAT's incredibly consistent market-beating performance this year. Since the calendar flipped to January, this big tech trade has surged more than 72% on a total-return basis.

And that rally isn't showing any signs of fatigue here - quite the contrary, in fact.

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Applied Materials spent most of the past several months forming a pretty textbook example of an ascending triangle pattern, a bullish continuation setup that signals the potential for more upside. The pattern is formed by horizontal resistance up above the shares at the $52.50 level, with uptrending support to the downside.

Thursday's unmistakable breakout through $52.50 clears the way to new 52-week highs.

That's confirmed in part by relative strength, the indicator at the bottom of the price chart. Relative strength indicates Applied Materials' relative performance versus the broad market -- the fact that it's in an uptrend of its own indicates that the shares continue to systematically outperform the rest of the S&P 500, even now.

Now looks like as good a time as any to start building a position in Applied Materials. Just bear in mind that the shares could pull back to retest newfound support at the $52.50 level.

Meanwhile, risk management remains key here. The 50-day moving average has acted like a reasonably decent proxy for trendline support, and that makes it a logical place to park a protective stop on the other side. If Applied Materials meaningfully violates its 50-day, then the uptrend is over and you don't want to own it anymore.

Until then, this big semiconductor stock is in full-blown breakout mode.

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