A Chinese stock benchmark pushed through its latest technical barrier Friday amid optimism on U.S. trade relations. But when the 100-day moving average for the CSI 300 Index was previously broken in February, it didn’t bring a lasting rally.
The index, which tracks China’s biggest companies listed in Shanghai and Shenzhen, closed up 1% at 3,963.62. The CSI 300 moved above its 50- and 200-day levels last week ahead of the Labor Day holiday break. While climbing through moving averages generally signals strength in the underlying market, the CSI 300 slid just weeks after breaking above them in February amid a global rout.
The CSI 300’s 14-day relative strength index has neared overbought territory, which it hasn’t reached since January. In the CSI’s 12% jump from March’s low, consumer-staple stocks have been the best performing group, rising 23%.