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108.170

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XAUUSD
1748.09

0.58%

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Russia-Ukraine Conflict

The war between Russia and Ukraine continues, and it is difficult for the two sides to reach an agreement in negotiations. Western countries have imposed several rounds of sanctions on Russia. The outlook is unpredictable.

Situation in Taiwan Strait

Pelosi's visit to Taiwan has led to an escalation of tensions in the Taiwan Strait. Chinese Foreign Ministry spokesperson Hua Chunying said that the U.S. side and the "Taiwan independence" separatist forces colluded to provoke China, which is the fundamental reason for the tensions in the Taiwan Strait.

The Fed

The Federal Reserve (Fed), or the central bank of the United States, is responsible for regulating the U.S. monetary policy and interest rates. As a provider of liquidity for world trade, the Fed is also known as the world's central bank. Its every move affects the global economy and financial markets.

China-U.S. Relations

Focus on Pelosi's Taiwan Visit ! How will China-U.S. relations develop in the future, win-win cooperation or confrontation?

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      XAUUSD: Spotlighting an Unwelcome Journey

      China-U.S. RelationsSituation in Taiwan Strait
      Summary:

      In the case of escalating China-US tensions, it is still optimistic about the upward space. Markets were rattled by the expected visit of U.S. Pelosi to Taiwan amid warnings from China. Gold bulls are still on track to test key resistance at $1,787.

      Buy XAUUSD
      End Time
      CLOSED

      1781.81

      ENTRY PRICE

      1824.00

      TGT PRICE

      1748.00

      SL PRICE

      1748.09 -10.22 -0.58%

      75

      Points

      Profit

      1748.00

      SL PRICE

      1782.56

      CLOSING

      1781.81

      ENTRY PRICE

      1824.00

      TGT PRICE

      Fundamentals

      Safe-haven funds have been the theme of the market so far this week. Of course, there are other factors that influence market sentiment, but geopolitics is obviously playing a leading role.
      Open interest in the gold futures market fell for a second straight session on Tuesday by more than 4,000 contracts, according to high-frequency data order flow from CME Group. Likewise, volume was down for the fourth straight session and around 105,000 contracts are deducted. Gold's gains on Tuesday came amid reduced open interest and volume, suggesting a possible correction to the downside could develop in the near term. In addition, gold's price movement appears to be capped by the $1780 level so far.
      The rise in risk appetite this time was triggered by geopolitics. U.S. House Speaker Nancy Pelosi is rumored to be expected to arrive in Taiwan later today and meet with the region's leaders early tomorrow. At the same time, the event will be an "all-nighter" for financial markets, and if Pelosi makes a successful visit to Taiwan, it will be the most senior US official to visit Taiwan in 25 years, making it a symbolic event.
      Notice how this is all written in the conditional tense? There was no official confirmation that the visit would take place, as Pelosi herself tweeted earlier this week her itinerary, which did not include Taiwan. Clearly, China is very unhappy with the visit, and potential retaliatory measures including a "military" option will be taken.
      Despite the USD rebounded recently, buying interest in gold has not waned as investors prefer to hold gold as a store of value amid escalating tensions between the U.S. and China over Taiwan.
      Rising geopolitical tensions have also led to safe-haven flows into traditional safe-haven assets such as U.S. bonds, negatively impacting U.S. Treasury yield, while a continued slide in yields could still weigh on the USD. In near future, geopolitics remains a closely concerned focus for financial markets over the next few sessions.
      XAUUSD: Spotlighting an Unwelcome Journey_1

      Technical Analysis

      After the gold price rebounded in the past few days, the momentum has weakened but is still running above the 4-hour Bollinger middle band. In addition, the 5-day and 10-day moving averages form a golden cross and move upward, suggesting that demand for rebound still exists, and to go long at lows is recommended. Moreover, the upper target resistance is concerned with the 4-hour 200-periodic line and the Bollinger upper band, while the lower target is the 1-hour Bollinger lower band and the upward support.
      It is expected that the possibility of the gold price breaking above 1800 in the next few trading days increases significantly, and the target can even be seen near the Bollinger upper band around 1824 in the daily chart. However, in the short term, the possibility of a surge and a shock consolidation should be considered. Therefore, it is recommended to buy the dips.

      Trading Recommendations

      Trading direction: Long
      Entry price: 1776
      Target price: 1824
      Stop loss: 1748
      Validity: 20:00:00, 2022/08/16
      Support: 1764/1758/1750
      Resistance: 1798/1812
      Risk Warnings and Investment Disclaimers
      You understand and acknowledge that there is a high degree of risk involved in trading with strategies. Following any strategies or investment methodologies is the potential for loss. The content on the site is being provided by our contributors and analysts for information purposes only. You alone are solely responsible for determining whether any trading assets, or securities, or signal, or any other product is suitable for you based on your investment objectives and financial situation.

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      Eva Chen

      Analyst

      Master of Economics, 8 years in the financial industry, CFA holder, joined HSBC (Hong Kong) Bank in 2013 after graduating from the University of California, USA in the Investment Research and Markets Department. With years of financial market experience and trading experience, having provided excellent investment advice to many brokerages, entity derivatives importers and clients in Greater China.

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      Win Rate

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      P/L Ratio

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      Focus on

      XAUUSD, WTI, USDCAD

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