Yet another Australian expression of surprise, disbelief ar anguish. There is quite a collection of these (see tags below).
Usually said with each word pronounced very separately and deliberately, but is quite often uncontrolled. The first thing I said when I turned on the TV and saw the World Trade Centre collapse was:
It is said of the situation where a person has the bad luck to make contact with his testicles against an undefined surface or object, intentioned or not.
Given the nature of the word, it is more appropriate to design cases where the interaction is made with a moving object, for example, a ball.
Although it is extremely painful for the victim, it tends to be considerably funny to people who witness it.
Today in the baseball game the pitcher took a nutshot; the baseball hit him in the nuts.
Man, I just watched the funniest nutshot video ever.