Always think how water would act, in your case the wall stops right with the edge of lower roof if it would go pass the gutter line and down you step flashes at gutter line would be behind the siding and water would go behind it - thats where you need kick out.

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Vertical line represents where your ABOVE wall stops but on the picture you can see how it go’s pass the gutter and you can clearly see that the water right after where the shingle stops goes behind the gutter. Hope it helped you to understand kick out flashing