The oil services sector (OIH) is one of the worst performing sectors in the market year to date (-13.2%). However, October has been a good month for this beaten down sector and the OIH exchange-traded fund is testing a key area of support/resistance for the 4th time in 3 months:
There are a lot of constructive signs suddenly appearing this chart after a brutal year for the energy space:
- The October low put in a higher low on lighter volume
- The October rally has been sharp and has taken place on heavy volume
- The pullback earlier this week was shallow and quickly found dip buyers
- The August and October lows form a nearly symmetrical double-bottom pattern
A decisive breakout above ~$32.50 will target $36.50 which would actually put OIH in the green for the year. Will the 4th time be the charm or does the oil space need some more time to consolidate the recent gains?