The OIH(VanEck Oil Services ETF reaches new June highs.

The OIH is trading at new June highs today. The index is up over 3% as it extends the rebound off the May/June lows to 13%. Major support near $13.00 is shaping up as a double bottom. This area marks the December 2018 spike lows.

At the December lows the OIH reached a deeply oversold reading after falling over 50% over the previous 10 weeks. A fresh rally leg from the current 2019 lows could be quite significant. In the near term a close back below this week’s low($14.00) would indicate more basing is ahead before a rebound develops.

The top two holdings in the OIH are SLB and HAL. Combined the two account for a 30% weighting. We highlighted SLB back on June 11th: http://thisweekonwallstreet.com/slumping-schlumberger-poised-for-a-rebound/ .

We are long SLB and HAL in some managed accounts.