Gold Price Forecast: XAU/USD to extend sideways grind below $1,800 ahead of FOMC

• Gold is struggling to find direction for the second straight day.
• Additional gains are likely if buyers manage to clear $1,800. 
• Market participants await minutes of FOMC's July policy meeting.

After losing its bullish momentum ahead of $1,800, gold closed the day virtually unchanged on Tuesday and continues to have a tough time making a decisive move in either direction. As of writing, the XAU/USD pair was flat on the day at $1,785.

Despite the broad-based USD strength, XAU/USD's movements remain limited on Tuesday as the precious metal also was able to capitalize on safe-haven flows. In the absence of high-tier macroeconomic data releases, the greenback stays relatively quiet against its major rivals with the US Dollar Index moving sideways above 93.00 on Wednesday.

Earlier in the day, the data published jointly by the US Census Bureau and the US Department of Housing and Urban Development showed that Housing Starts contracted by 7% on a monthly basis in July. On a positive note, Building Permits increased by 2.6% in the same period.

Later in the session, the FOMC will release the minutes of its July policy meeting. Investors will look for fresh clues regarding the timing of the reduction in asset purchases. 

Previewing this publication, "the pertinence of the FOMC minutes have been superseded by the Michigan sentiment number and the sharp dip in consumer spending," argued FXStreet analyst Joseph Trevisani. "Even If the governors had discussed ending the bond program in the fourth quarter of this year or the first quarter of next, that was before Retail Sales declined in July and sentiment plunged off a cliff in August."

Commenting on gold's near-term outlook, Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, said that the pair could go into consolidation if it fails to break above the $1,806/12 resistance area.

"Gold has seen a strong bounce off the March lows at $1679/$1677, which is approaching tougher resistance offered by the 55, 100 and 200-day ma at $1806/12 and the resistance line at $1813," Jones explained. "We suspect that this will repel the advance at least on the initial test and provoke some further consolidation."

Gold Price Forecast: XAU/USD rally higher to struggle at the $1806/12 zone – Commerzbank.

Gold technical outlook

On the daily chart, the Relative Strength Index (RSI) indicator stays neutral around 50, confirming XAU/USD's indecisiveness. Additionally, key technical levels remain intact following the latest fluctuations.

On the upside, $1,800 (50-day SMA, psychological level) aligns as a strong resistance before $1,806 (100-day SMA) and $1,812 (200-day SMA). Static supports could be seen at $1,780, $1,760 and $1,750.