President Adams' reaction to the XYZ affair demonstrated his belief in what?

peaceful negotiation

Explanation:

President Adams was the 2nd President of the United States. He sent American diplomats to France in 1797 in order to lessen the tension that was happening between America and France. He was after the "peaceful negotiation" of the two nations.

The diplomats were Charles Cotesworth Pinckney, John Marshall and Elbridge Gerry. This then became the "XYZ affair" later on. However, the French agents asked them for a bribe before they could negotiate with the Prime Minister. This caused an outcry over the issue of "bribe solicitation." This was followed by an undeclared war.

Thus, this explains the answer.