pencil

I sign PENCIL by forming my hand into a handshape that looks like I'm holding a pencil in my right hand. I start the sign holding my hand near my mouth. Then I bring my right hand down near the palm of my left hand and make a writing movement across the palm and fingers of the left hand. So, this sign is loosely based on the concept of licking the pencil lead and then writing. (In the old days, apparently, people used to lick the lead to get pencils to write better. Don't try this at home folks.) Note: You don't actually lick anything in this sign, the hand merely comes "near" the mouth.

PENCIL (version 1)

This sign relies on context. You could also just sign: "YOU HAVE WRITE?" To mean, "Do you have a pencil or pen?"

Some people do the sign PENCIL with a "P" handshape, (this is called "initialization). I don't think that is necessary for this sign.
PENCIL (version 2)

By the way, the concept of "PEN" is commonly just fingerspelled.