Chewy (CHWY Quick QuoteCHWY - Free Report) reached a significant support level, and could be a good pick for investors from a technical perspective. Recently, CHWY's 50-day simple moving average broke out above its 200-day moving average; this is known as a "golden cross."

Considered an important signifier for a bullish breakout, a golden cross is a technical chart pattern that's formed when a stock's short-term moving average breaks above a longer-term moving average; the most common crossover involves the 50-day and the 200-day, since bigger time periods tend to form stronger breakouts.

A successful golden cross event has three stages. It first begins when a stock's price on the decline bottoms out. Then, its shorter moving average crosses above its longer moving average, triggering a positive trend reversal. The third and final phase occurs when the stock maintains its upward momentum.

This kind of chart pattern is the opposite of a death cross, which is a technical event that suggests future bearish price movement.

CHWY has rallied 62.6% over the past four weeks, and the company is a #1 (Strong Buy) on the Zacks Rank at the moment. This combination indicates CHWY could be poised for a breakout.

The bullish case solidifies once investors consider CHWY's positive earnings outlook. For the current quarter, no earnings estimate has been cut compared to 7 revisions higher in the past 60 days. The Zacks Consensus Estimate has increased too.

With a winning combination of earnings estimate revisions and hitting a key technical level, investors should keep their eye on CHWY for more gains in the near future.