Flat In Asia

Gold is back from session lows, dealing ~$1/oz firmer to print $1,937/oz at typing, sticking within a relatively tight ~$8/oz range during Asia hours. The precious metal operates well clear of Monday’s troughs as developments in the Russia-Ukraine conflict remain front and centre, with elevated worry over further armed escalation evident.

• To recap Monday’s price action, gold closed ~$15/oz higher despite U.S. real yields and the Dollar (DXY) ticking higher, with the latter dynamic aided by hawkish remarks from Fed Chair Powell).
• Looking to the Russia-Ukraine conflict, hope surrounding a diplomatic resolution from ongoing ceasefire talks has moderated, with the Kremlin stating on Monday that “there has been no significant progress so far”. Elsewhere, relations between the west and Russia have deteriorated, with former Russian President Medvedev issuing a lengthy letter denouncing the Polish leadership (noting that Russian attacks on Ukraine have come to within 15 miles of Poland’s border), while Moscow summoned the U.S. ambassador to Russia over President Biden’s labelling of President Putin as a “war criminal”, stating that Russo-U.S. relations were “on the verge of rupture”. The European Commission has also called for the stockpiling of supplies essential for protection in a nuclear incident (i.e. suits and iodine pills), exacerbating worry in some quarters re: a nuclear escalation in Europe.
• Looking to technical levels, bullion’s short-term conditions remain bearish, following the pullback from Mar 8 cycle highs at $2,070.4/oz. The longer-term bullish trend remains intact however, with the pullback considered to be corrective. Support is situated at $1,895.3 (Mar 15 low), while resistance is seen at $1,954.7/oz (Mar 15 high).