Equity Analysis
Australia ASX 200 Index
Market Overview
The S&P/ASX 200 fell 45 points, or 0.5%, to close at 8,779 on Tuesday, ending a two-session winning streak. Weakness in non-energy minerals, transportation and producer-manufacturing names weighed on the index. Sentiment turned cautious after the Reserve Bank of Australia’s June minutes noted that inflation remained well above the 2-3% target range and that underlying price pressures appeared to be building in the second quarter.

Policymakers indicated that further tightening remained possible after three rate increases this year, adding that restrictive policy settings and elevated oil prices could curb demand and help rebalance the economy. Two of the four major banks slipped between 0.3% and 0.7%, while BHP Group lost 0.9%, Northern Star fell 5.2% and Evolution Mining declined 4.7%. By contrast, Euroz Hartleys jumped 7.6% after agreeing to sell its capital-markets division to Bank of Montreal. Despite the pullback, the market still recorded a third consecutive monthly gain, rising 0.5% for the month and around 3.5% for the quarter, supported by resilient consumption, employment growth and ongoing factory expansion.

Technical Analysis
The ASX 200 closed at 8,778.70, down 0.51%, forming a small bearish candle and failing to hold the key 8,800 level. Short-term momentum is slightly weak, although the medium-term uptrend remains intact, with the index still above both the 50-day and 200-day moving averages. The short-term stance is therefore wait-and-see. The candle body was small and the upper and lower shadows were balanced, indicating disagreement between bulls and bears, with sellers holding a slight edge.

MACD (12, 26, 9) showed a narrowing histogram, while the fast line moved close to the slow line, suggesting a potential bearish crossover and weakening upside momentum. RSI (14) fell to 52.3 from 58 last week, a neutral-to-soft reading that has not yet reached oversold territory and still leaves room for further downside. Although the index declined overall, defensive sectors such as health care and consumer staples performed relatively well, while heavy-weight materials and financials dragged on the broader market. This reflects a more cautious tone around the Australian financial-year end and ongoing concerns over global growth and the rates outlook.

Hong Kong Hang Seng Index
Market Overview
The Hang Seng Index fell 0.6%, or 146 points, to close at 22,881 on Tuesday, giving back part of the previous session’s gains. Despite continued policy support from Beijing, investors remained cautious. Market sentiment stayed subdued even after the People’s Bank of China conducted overnight reverse-repurchase operations to maintain ample liquidity in the financial system; the operation provided only limited support to equities.

Investors also weighed the fact that, despite strong gains in overseas markets, Chinese equities continued to lag the global AI-led rally, reflecting persistent uncertainty over China’s economic recovery. Losses were led by Insilico Medicine (-3.5%), Trip.com (-3.5%), Pop Mart (-2.0%), Akeso (-3.4%) and AIA (-1.3%). In June, the Hang Seng Index fell 9.1%, its weakest month of the year. The benchmark also lost 7.6% in the second quarter, underscoring continued concern over China’s economic outlook.

Technical Analysis
The Hang Seng Index closed down 0.63% at 22,881.02, with clear structural divergence: technology and semiconductor names outperformed, while traditional cyclicals dragged on the benchmark. Technically, the index remains in a descending channel. The 22,518 level is the short-term line in the sand, while a move above 23,484 would be needed to confirm a more constructive rebound.

On the daily chart, the index has been trending lower since the 15 June high of 25,048. Tuesday’s candle was a bearish doji around 22,900, and the index failed to hold above the 23,104 bull-bear line. RSI (14) is around 42, neutral to low but not yet oversold. Daily MACD remains in a bearish-crossover configuration, with no clear bullish divergence. The 5-day, 10-day and 20-day moving averages are aligned bearishly, indicating a downward medium-term trend and heavy rebound pressure. Turnover of HKD 308.05 billion was slightly lower than the previous session, pointing to a strong wait-and-see attitude among investors.

Currency Analysis
US Dollar Index
The dollar fell 0.24% at the start of the week to 101.11, but remained close to a 13-month high. It is up 2.19% for the month, supported by optimism over the US growth outlook, expectations of further Federal Reserve rate increases and capital inflows linked to the AI theme. On the US-Iran front, technical teams from both sides are expected to meet in Doha in the coming days to implement a temporary peace arrangement. At the same time, US market-regulator data showed that investors’ long-dollar positions reached around USD 36.4 billion, the highest level since 2019.

The dollar index has been strong overall this month and is on track for its largest monthly gain in nearly a year, supported by geopolitical tensions, shifting Fed-policy expectations and global safe-haven flows. However, short-term price action on Monday already showed signs of pressure. With multiple positive catalysts fading at the margin, policy expectations being recalibrated and the technical picture calling for a pullback, the dollar may enter a choppier and weaker short-term adjustment phase. Ahead of Thursday’s nonfarm payrolls report, the dollar index could also see profit-taking, regardless of whether the data meets expectations.

As expectations for further Fed tightening soften, the dollar has weakened for three consecutive sessions. Swaps now price less than 20 basis points of additional tightening by September. The May-to-June rally has shown signs of a bearish pause, suggesting corrective pressure could pull the index back toward the 100.50/100.60 area. Overall, only a decisive break below 101.00, together with the 101.19 area around the 9-day simple moving average, would potentially reverse the short-term bullish structure. That would open the way toward 100.44, the 20-day simple moving average, and the key psychological level of 100.00. Conversely, if the index returns above 101.39, the next levels to watch are 101.80 and 102.00.

AUD/USD
AUD/USD fell for a third consecutive session on Tuesday, trading near 0.6870 during the Asian session. The Australian dollar remained under downside pressure as the US dollar strengthened on a more hawkish Fed-policy outlook. According to the CME FedWatch tool, traders now price the probability of a September Fed rate increase at close to 60%. This shift has put this week’s key US labour-market releases in focus, culminating in Thursday’s nonfarm payrolls report, which should provide fresh guidance for the Fed’s rate path.

The dollar also drew safe-haven support from persistent geopolitical uncertainty surrounding US-Iran relations. US President Trump said the two sides would hold a new round of talks in Doha on Tuesday after weekend conflict in the Middle East, according to CNBC. Tehran denied the claim, saying no talks with Washington had been scheduled at any level and that Iran remained focused on implementing existing understandings rather than entering final-agreement negotiations.

The Australian dollar has continued to lose momentum. Dollar strength and geopolitical developments appear to be weighing on AUD/USD, pushing the pair back below 0.6900. The pair has almost erased its rally from late March to mid-May and has now fallen for seven consecutive days, breaking below 0.6900 support, touching a multi-week low and opening the way for an eventual test of the key 200-day moving average near 0.6862. On the daily chart, AUD/USD remains below 0.6900 and has broken under the 9-day simple moving average at 0.6933 and the 14-day simple moving average at 0.6975; both now act as resistance and reinforce the short-term bearish bias. Price remains slightly above the 200-day simple moving average at 0.6862, while RSI (14) is around 26, indicating oversold conditions. ADX (14), near 40, suggests the downtrend remains strong despite stretched momentum. Initial support is the 200-day SMA at 0.6862, followed by horizontal support at 0.6833 and a stronger support zone around 0.6800.

GBP/USD
Sterling held above 1.32 against the US dollar, rebounding from a recent seven-month low. Andy Burnham, positioned as a potential successor to Keir Starmer, pledged that if elected he would significantly devolve fiscal powers from Westminster to local authorities while maintaining fiscal discipline. At the start of the week, GBP/USD fluctuated just above 1.3200 and had not yet moved out of its low-level consolidation range.

The current backdrop is not straightforward. The Bank of England kept its benchmark rate unchanged at 3.75% in June, but the vote split widened to 7-2. The BoE also noted that CPI had eased to 2.8%, although energy shocks could push inflation higher again later this year. On the surface, a stronger hawkish voice inside the BoE should support sterling through rate differentials. Yet GBP/USD remains near 1.32, suggesting traders are focused on the macro implications of rate hikes rather than the question of whether hikes occur. Higher rates driven by supply-side inflation do not automatically translate into currency strength. If higher rates mean weaker purchasing power, rising business costs and slower demand, sterling receives rate-differential support but also carries a growth discount.

This week, GBP/USD rose meaningfully toward about 1.3250. The short-term bias has turned mildly constructive as the pair moved back above the 14-day simple moving average at 1.3216. RSI is around 46, slightly below the midpoint, suggesting steady rather than aggressive upside momentum while price consolidates above support. MACD remains negative, with DIFF around -0.0067 and DEA around -0.0055. The histogram is still below zero, indicating that bearish momentum is narrowing but that evidence of a full trend reversal remains insufficient. On the upside, the main resistance is the 20-day simple moving average at 1.3309, followed by the descending resistance trendline near 1.3328, the 18 June high. Initial support is near the 1.3200 psychological level, followed by the key 1.3124 area, the 24 June low.

USD/JPY
The yen held above 162 per US dollar on Tuesday, its weakest level since 1986. The move has raised concern among policymakers and kept investors alert to the possibility of currency intervention from Tokyo. The yen remains under pressure as the interest-rate gap between Japan and the United States persists. The Bank of Japan is still normalising policy gradually, while the Fed is expected to deliver multiple rate increases this year. Ongoing carry trades and sustained demand for the dollar as a safe-haven currency have also continued to weigh on the yen. Meanwhile, Japan remains exposed to energy-supply disruptions because of its heavy reliance on Middle Eastern oil imports. On the economic front, Japan’s May industrial production growth came in below expectations, underscoring the impact of Middle East tensions on supply chains and energy costs.

USD/JPY traded roughly flat around 162.00 and extended its advance well above the 20-day simple moving average at 160.91. As long as this support holds, the short-term bias remains bullish. RSI is 74.61, an overbought reading that signals strong upward momentum but also increasing risk of a corrective pause rather than a fresh acceleration. To the upside, the pair would need a clear break above 162.00 to challenge 163.00 and 164.00. On the downside, initial support is the 9-day simple moving average at 161.69. A pullback toward the 20-day SMA at 160.91 may attract buyers. A sustained break below that moving average would weaken the constructive structure and open the door to a deeper pullback toward 160.00.

EUR/USD
EUR/USD edged lower in early Asian trading on Tuesday, hovering near 1.1420. The euro softened as traders reduced bets on further European Central Bank rate increases this year. Speaking at the opening of the ECB’s annual forum on Monday, President Christine Lagarde said Europe’s vulnerability to external shocks was declining thanks to a stronger financial framework and progress in the green transition. As energy prices ease, markets have scaled back expectations for future ECB hikes. Later this week, US ADP employment data and nonfarm payrolls will be key focal points, as these reports may offer new clues about the Fed’s policy stance. Any signs of a strong US labour market could support the dollar and act as a headwind for the major pair.

The pair has repeatedly failed to hold above 1.1450 and has struggled to generate meaningful upside momentum, which favours sellers. RSI is near 37, indicating a gradual recovery from oversold territory rather than a bullish shift. MACD has turned slightly positive, but EUR/USD still faces structural short-term pressure. This suggests that any meaningful rebound attempt may still be viewed as a selling opportunity and could fade quickly. Immediate resistance is around 1.1473, last week’s high. A break above that level could lift EUR/USD toward 1.1500. Only a move through this resistance would ease the current bearish tone and create room for a more meaningful upward correction. On the downside, the 1.1400 round number is the first level to watch; a break below would expose 1.1324, last week’s low, and the 1.1300 area.

Commodity Analysis
WTI Spot Crude Oil
Oil prices regained geopolitical risk premium as President Trump said the US and Iran would meet in Doha today, while Iran said there were no plans for any talks with Washington in the coming days. Israel’s defence minister also said the Israeli military was prepared to take independent military action against Iran. WTI crude is trading near USD 70 per barrel.

Sources said technical teams from the US and Iran are expected to meet in Doha in the coming days. Iran’s deputy foreign minister also said Iran would consult Oman on redefining strait-passage routes and attempt to prevent vessels from violating passage rules. Meanwhile, Middle Eastern producers continue loading shipments, and crude exports from the Persian Gulf have reportedly recovered to at least 75% of pre-war levels. However, analysts warned that shipping has not fully normalised, with water mines, incomplete insurance coverage and the risk of attacks on vessels still acting as constraints. The market’s base-case assumption is that Gulf supply will continue to recover and oil flows will ease the previous shortage. At the same time, talks over transit fees, route arrangements and security guarantees have not been finalised, indicating that the strait has not returned to pre-event low-friction conditions.

From a technical perspective, WTI remains clearly below the 9-day simple moving average at USD 72.27. This suggests the recent decline is not merely a news-driven pullback; rather, the trend centre has shifted lower. MACD shows DIF at -6.63, DEA at -5.88 and the histogram at -1.51, meaning momentum has not yet fully repaired. WTI has declined for two consecutive sessions, but price has returned above USD 70, indicating some recovery in buying interest. Overall, however, it remains within a recent consolidation range, with bulls and bears still contesting the direction around the key USD 70 level. A renewed break below USD 70.00 could bring another test of USD 68.80, last week’s low and the rebound-defence level. A break below that would restore weakness and point toward USD 65, the medium-term downside target. Conversely, if price breaks and holds above the 9-day SMA at USD 72.27, oil could challenge the 200-day moving average near USD 73.08.

Spot Gold
Spot gold traded near USD 4,016 per ounce on Tuesday morning. Renewed tensions between the US and Iran raised inflation concerns and reinforced expectations of higher interest rates, limiting gold’s upside. On Sunday, Iran launched missiles and drones at US military facilities in Kuwait and Bahrain after President Trump threatened to remove Iran’s leadership if it failed to comply with a final peace agreement. Oil prices rose after the attack, while markets continued to digest the Fed’s decision to keep rates unchanged this month and policymakers’ projections for rate increases later this year. The dollar is also on track for its largest monthly gain in nearly a year, making gold more expensive for overseas buyers.

Investors are waiting for Wednesday’s ADP employment data and Thursday’s US nonfarm payrolls report for monetary-policy guidance. Traders currently price the probability of a September rate increase at about 63%. Strong employment data would support the case for the Fed to keep rates higher and could push gold to fresh lows.

The key issues now are, first, how the US responds to Iran’s open attack on US military bases, and second, whether gold can begin to trade independently of equity markets. After the recent break below key levels forced speculative positions to exit, gold’s function as an equity-market hedge may start to return, which would support prices. The four-hour chart shows a bearish structure, with gold still below the 9-period simple moving average at USD 4,044. Both short- and long-term moving averages are above price, suggesting that rebounds may be capped. RSI is hovering near 39, while momentum has turned lower around its midline, reinforcing the downside bias. Near-term resistance is the 9-period SMA at USD 4,044, where the first rebound may stall, followed by heavier resistance below the lower Bollinger Band near USD 4,097 and then the USD 4,100 round number. These levels maintain broader bearish pressure. A break below USD 4,000 would put the recent multi-month low at USD 3,959 in focus; a clear break below that support would open the door to a steeper and more sustained decline.