While it is true that materials stocks, broadly speaking, have lagged the broader market over the past two years, the sector’s performance has still been solid.

Since late March 2012, the Materials Select Sector SPDR (NYSEArca: XLB) is up 31.8%, trailing the SPDR S&P 500 ETF (NYSEArca: SPY) by 600 basis points. An obvious drag on the materials sector has been the coal industry. Over the past 24 months, the Market Vectors-Coal ETF (NYSEArca: KOL), once something of a bellwether ETF used to measure risk appetite, has plunged 42%. However, there are some signs that KOL and some of its 35 holdings are finally waking up. [ETF Laggards Rising in 2014]

KOL was down 5.7% year-to-date heading into Friday, so it is understandably difficult to get excited about the ETF’s 0.7% gain this week, but that does not mean the fund should be ignored in the near-term.

“After hitting 51.87 in April of 2011, KOL has been in an almost three year downtrend.  It recently made a low of 17.27 in February and a low of 17.40 in March.  Since developing this double bottom it has shown some signs of life.  We have seen its MACD cross above signal and it is trading above its 20 and 50D moving averages,” said Street One Financial Market Technician Dave Chojnacki  to ETF Trends.

The $140.4 million KOL “is fast approaching resistance of its down sloping trend-line, which coincides with its 200D-SMA of 18.53.   It RSI is in bullish territory, but one thing we are not seeing is volume that would add more conviction to this move,” adds Chojnacki .

Chris Kimble of Kimble Charting Solutions says two coal plays to watch are Arch Coal (NYSE: ACI) and Cliffs Natural Resources (NYSE: CLF). Arch is 2.05% of KOL’s weight while Cliffs is not a member of the ETF’s lineup.

As for the near-term technical outlook on KOL, this is what Chojnacki is looking for: