Asia mid-session: Equities rebound as Israel-Iran ceasefire hopes emerge; oil plunges, Aussie outperforms

[Ben Graham]

Global markets experienced another volatile session on Monday, 23 June, swinging sharply from early risk-off sentiment to a late-session risk-on rally as fresh developments unfolded around the Israel-Iran conflict.

Israel-Iran ceasefire may put an end to the 12-day war

Iran’s retaliatory strike on a US airbase in Qatar, following the US bombing of Iranian nuclear enrichment facilities over the weekend, was widely perceived as a symbolic and restrained move. Crucially, it left the Strait of Hormuz untouched, easing fears of disruptions to Middle Eastern oil supply.

Adding to the shift in sentiment, US President Trump announced via social media that a ceasefire deal between Israel and Iran had been brokered, though details remained scarce. Markets interpreted this as a signal that both countries may be nearing a pause in their 12-day military confrontation.

Bearish reversal in WTI crude sparks a risk-on sentiment jump

WTI crude oil saw a dramatic intraday reversal. After surging over 4% in early Asian trading, it plunged by -9.3% by the close of the US session, finishing at US$68.36—below its 13 June pre-conflict close of US$73.08. This sharp sell-off reflected a significant unwinding of the geopolitical risk premium and a reduction in stagflation concerns, fueling a positive risk-on feedback loop into equities.

Both the S&P 500 and Nasdaq 100 rebounded sharply after retesting key near-term support levels at 5,920 and 16,500, respectively. They closed with gains of 1% and 1.1%, and in today’s Asian mid-session, their E-mini futures extended gains to 0.7% and 1.0%, respectively.

Asian markets mirrored the upbeat tone: Japan’s Nikkei 225 rose 1.24%, Hong Kong’s Hang Seng Index climbed 1.8%, and Singapore’s Straits Times Index gained 0.4%.

High-beta Aussie and Kiwi dollars stage a bullish U-turn

Meanwhile, the US dollar weakened, with the US Dollar Index falling -0.4% after being rejected at its 50-day moving average of 99.50. It closed at 98.35, erasing gains from the previous four sessions and continuing a broader bearish trend in place since mid-February.

High-beta currencies such as the Australian and New Zealand dollars rebounded strongly. In today’s Asian trade, NZD/USD and AUD/USD rose 0.7% and 0.6%, respectively, while the Japanese yen appreciated 0.6% against the dollar.

Gold (XAU/USD) underperformed as it broke below its 20-day moving average

In contrast, Gold (XAU/USD) underperformed amid renewed risk appetite, falling -1.1% and breaching its 20-day moving average support at US$3,350 for the first time since 21 May. The yellow metal is now eyeing the next support zone at US$3,320/3,200, which aligns with the 50-day moving average within its medium-term uptrend.

Economic data releases

Fig 1: Key data for today’s Asia mid-session (Source: MarketPulse)

Chart of the day – Potential bullish breakout in AUD/USD

Fig 2: AUD/USD minor & medium-term trends as of 24 June 2025 (Source: TradingView)

Since its 24 April 2024 minor swing low of 0.6350, the AUD/USD has traded in a sideways range configuration in the past eight weeks, and several technical elements suggest an imminent bullish breakout.

The price actions of the AUD/USD staged a minor bullish reversal on Monday, 23 June, after a retest close to its range support of 0.6360/6350.

In addition, the 4-hour RSI momentum indicator has just staged a bullish breakout above a parallel descending resistance line above its 50 level and has not reached its overbought region (above 70).

These observations suggest an emergence of bullish momentum conditions. Watch the 0.6455/6440 key short-term pivotal support, and a clearance above 0.6545 (8-week range resistance) sees the next intermediate resistances coming in at 0.6600 and 0.6690 (see Fig 2).

On the other hand, failure to hold above 0.6440 negates the bullish tone for another round of choppy corrective decline to drift downwards to retest 0.6407, and the range support of 0.6360/6350.

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