After a 54% decline since June 2014 the oil services sector (OIH) is on the brink of confirming that a long-term bottom has been put in place:
OIH (Weekly)
Momentum and volume divergences at the summer lows
A weekly close above important support/resistance near $32.50 would complete the double-bottom/complex H&S bottom patterns which have formed recently:
OIH (Daily)
Perhaps most supportive of a further rally in the oil services sector are the number of portfolio managers who have underweighted the sector in recent months. This pervasive underweight bias combined with continued bearish sentiment on crude oil itself could be supportive of a year end rally that would surprise the herd:
