Four-Week Highs In Asia; Pelosi Visit Eyed

Gold deals ~$5/oz firmer, printing ~$1,777/oz at typing. The precious metal sits a little below fresh four-week highs ($1,780.5/oz) made after Taiwanese media offered an exact time for U.S. House Speaker Pelosi’s visit to Taiwan, adding to tailwinds from a downtick in the USD (DXY) and nominal U.S. Tsy yields.

• Immediate focus has turned to risks surrounding China’s response to Pelosi’s Taiwan trip, with U.S. Tsys catching a bid alongside defensively-oriented flows observed in the FX space, while regional cash equity indices and e-minis have gone offered.
• To recap, gold closed ~$6/oz firmer on Monday, recording a fourth straight higher daily close, coming as the USD (DXY) has simultaneously notched four consecutive lower closes. The overall move higher in gold also came amidst the backdrop of disappointing data releases out of the U.S. and Europe on Monday as well, contributing to prior recession-related worry.
• From a technical perspective, gold’s recent bounce is still seen as corrective, with focus on initial resistance at ~$1,785.3/oz (50-Day EMA), a break of which would bring $1,812.0/oz (trendline resistance) into view. On the other hand, support is seen at ~$1,745.1/oz (20-Day EMA).