(Bloomberg) -- Hong Kong stocks’ six-week rally may continue for the rest of the month with the benchmark Hang Seng Index likely piercing through a so-called resistance point at 16,000, according to UOB-Kay Hian Ltd. The Hang Seng added 0.1 percent to 15,601.27 at the close of trading today, bringing its gain for the week to 4.7 percent. The index has surged 37 percent from a four-month low reached on March 9 amid optimism government stimulus efforts, including China’s 4 trillion yuan ($585 billion) spending plan, will ease the economic slump.
“The Hang Seng index could break the 16,000-point level,” said Steven Leung, director of institutional sales at UOB-Kay Hian in Hong Kong. “The momentum is very strong.”The gauge is trading just below its 200-day moving average of 16,301.03, according to data compiled by Bloomberg. Moving averages show the mean value of a security’s price over a set period. They are generally used to measure momentum and define areas of possible support and resistance in technical analysis.“Investors are getting bullish,” Leung said. “They are buying on slight pullbacks.”
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