Short Positions Suggested As S&P/NZX 50 Plunges After RBNZ Limits Lending To Real Estate Sector
The S&P/NZX 50 index is encountering turbulence with 23 stocks down, 18 higher and 9 unchanged. The Reserve Bank hinted at applying more lending restrictions as part of moves to prevent rising house prices in Auckland and around the country. This has caused a slide in real estate stocks. Additionally, the rally in house prices has caused alarm over the possibility of a housing market bubble and risks to stability of the financial system. Such sentiment is creating concern for investors and driving them away from the index. On the hourly chart, the index is moving downwards to 6991.51, after testing the resistance at 7051.07. RSI (14) is slipping to the level of 57.9578, showing that the bullish trend is weakening. The index is anticipated to fall further.
Sell stop at 6989.68, Take profit at 6976.37, Stop loss at 6995.39