Kiwi is trading lower after a new capital gains tax on residential property investments raised speculation that RBNZ will cut its interest rates in coming months. The income gained on properties sold within two years of purchase are taxed up to 33%.
Technically Kiwi is not able to trade above 0.7575 and this confirms that it has formed temporary top around that level. Short term trend is as long as resistance 0.7500 holds.
On the upside minor resistance is around 0.7446 (200 day 4 ) and break above would extend gains till 0.7500/0.7575.
The pair’s minor support is around 0.7380 and any break below will drag the pair further down till 0.7345/0.7315.
We prefer to sell on rallies around 0.7445 for the target of 0.7320 with stop around 0.7505.