The Chu Beam is the gun Ulala uses in Space Channel 5 and Space Channel 5 Part 2. It is activated by the A button (Dreamcast Version) or the X button (Playstation 2 version). In the first game Fuse calls it "shoot" or "chu" and Ulala and most others said "chu". Although the Morolians usually say something that sounds like "kiss" or "chin" or the s word.
In Part 2, everyone says "chu", however, Pine's "chu" usually sounded like "choon" or "june". Also, Ulala's "chu" sometimes sounded like "chi" or "gee" in Part 2. When fired, the Chu Beam looks like a green light.
"Chu" in dancing mode is just another dance move similiar to the other ones. It is probably the most used dance move.
"Chu" in shooting mode is the beam that shoots your enemy. It is most commonly used by the Morolians (original game) or the Rhythm Robots (Part 2). In the first game it is also the rescue beam, but in Part 2 it is replaced with "hey" to rescue hostages (or perform more dance moves).