The iShares U.S. Medical Devices ETF (IHI) has been in a downtrend since early 2026, significantly underperforming major indices. Despite previous failed rally attempts that generated MACD buy signals, the ETF is currently testing a downtrend line and has formed a potential double-bottom pattern.
The resistance level at 51 aligns with the 50-day moving average, which IHI is now approaching for the first time since early 2026. The 14-day relative strength index has also risen above 50, indicating improved momentum. Historically, IHI has bounced back from the mid-40s support zone, where it has found support on multiple occasions in the past.
This recent decline has brought the ETF back to this established support area, suggesting that buying during weakness could be a rewarding strategy. Additionally, IHI has shown relative weakness compared to the State Street Health Care Select Sector SPDR ETF (XLV), with the IHI/XLV relative strength line reaching its most oversold level in history.
While there are no guarantees of an immediate reversal, the combination of short-term and long-term technical developments indicates that the risk/reward profile for IHI is becoming more favorable than it has been in a long time