Heading into Monday's session, the Market Vectors Coal ETF (NYSE: KOL) had gained 3.8 percent in the past week, an impressive feat for a fund that had plunged 25 percent year-to-date.

The $159.5 million KOL is getting some important follow through Monday with a strong volume gain of 2.4 percent, perhaps indicating the worst is over for the savagely beaten coal sector.

KOL has been beaten up due to a plethora of factors including slowing growth in previously coal-crazy emerging markets such as China and India and company-specific problems such as those seen at metallurgical coal producer Walter Energy (NYSE: WLT), a KOL component.

In June, shares of Walter sank after the company pulled a planned $1.55 billion credit refinancing plan. Although Walter's second-quarter metallurgical coal output was about 2.9 million metric tons, about 7 percent more than, the company slashed its quarterly dividend to a penny a share from 12.5 cents, according to ETF Trends.

Related: Coal ETF Punished as Walter Sags.

Last Friday, KOL crossed its 50-day moving for the first time since May and the ETF now has its sights set on resistance around $19.50. Should KOL take out that price, it is smooth sailing for another $2 or $3 and that could be very good news for a new ETF, the PureFunds ISE Mining Service ETF (NYSE: MSXX).

MSXX, which debuted in late November 2012, hails from the same fund family as the PureFunds ISE Junior Silver ETF (NYSE: SILJ), a fund that is gaining a reputation for being a high-flier in its own right.

While KOL is a mix of producer and services firms with a bias toward the former, MSXX's 29-stock lineup is devoted to mining services providers. The U.S.-traded firms in the ETF's lineup include Joy Global (NYSE: JOY), a company that has been rumored to be takeover bait, Terex (NYSE: TEX) and Layne Christensen (NASDAQ: LAYN).

The U.S. only accounts for 17 percent of MSXX's weight, but the fund is developed markets heavy as Australia, Canada and Sweden combine for another 69 percent of the ETF's weight. Emerging markets exposure is light at a combined three percent to South Africa and Indonesia.

One day does not make a trend, but MSXX is proving it could offer some intimate, though not surprising correlation to a coal-stock recovery as the new ETF is up more than three percent on Monday.

As for whether or not a sustained coal rally is afoot, it can be said things probably cannot get much worse for shares of producers and related equities. Consider the following from a Moody's Investors Service report published last week:

"Moody's Investors Service has changed its outlook for the US coal industry to stable from negative, the rating agency says in a new report, "US Coal Industry Outlook Stabilizes as Business Conditions Hit Bottom." Moody's does not expect industry fundamentals to deteriorate further over the next 12 to 18 months, though business conditions remain very weak."

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