Gold Price Analysis: XAU/USD stages a modest recovery from multi-month lows

• Gold witnessed some short-covering move on Wednesday from the $1800 mark.
• COVID-19 vaccine optimism might cap any strong gains for the safe-haven metal.
• Investors now eye US macro data, FOMC minutes for a fresh directional impetus.

Gold edged higher during the early European session and was last seen trading near the top end of its daily range, just below the $1815 level.

The precious metal managed to find decent support near the $1800 mark, just ahead of a technically significant 200-day SMA and for now, seems to have stalled its recent downward trajectory. Sustained US dollar selling bias extended some support to the dollar-denominated commodity and prompted some short-covering amid near-term oversold conditions.

Investors also seemed inclined to lighten their bearish bets ahead of Wednesday's top-tier US macro releases and the latest FOMC meeting minutes. That said, the upside is more likely to remain capped amid the optimism over the progress toward remedies for COVID-19, which has been undermining demand for traditional safe-haven assets, including gold.

This makes it prudent to wait for some strong follow-through buying before confirming that the XAU/USD has found a near-term bottom and positioning for any further appreciating move.

Market participants now look forward to a flurry of top-tier US macro data for some short-term trading opportunities. Wednesday's US economic docket highlights the releases of the preliminary (second estimate) GDP report, Durable Goods Orders, Initial Weekly Jobless Claims and final Michigan Consumer Sentiment Index for November.

The key focus, however, will be on the latest FOMC meeting minutes, which will be scrutinized for the possibility of any further policy easing by the Fed in December. The Fed's policy outlook will play a key role in determining the next leg of a directional move for the non-yielding yellow metal.

Technical levels to watch