Market Summary (Jun 20, 2025)
Rising uncertainty over a possible US strike on Iran is keeping markets in risk-off mode. Safe-haven assets (USD, CHF, JPY and gold) are firming, while equities, high-beta currencies and crypto remain under pressure. We observe that any direct US involvement would likely trigger a sharp—but short-lived—flight to safety, with a swift reversal once operations conclude. EURUSD has staged a technical relief rally after breaching its corrective wedge around the 1.15 area, buoyed by White House talk of a “substantial chance” for negotiations and a two-week decision window. Despite expectations of dovish stances from the SNB and BoE, CHF strength persists on geopolitical jitters. Our longer-term thesis on AUDJPY remains intact given its wider stops. Gold’s behavior around its recent consolidation band will be critical for gauging the next leg of the risk-off move.
