(Kitco News) - Comex December gold futures are trading slightly higher in early U.S. dealings Monday. Trading remains choppy on a day-to-day basis but the bulls still enjoy the overall technical advantage. A higher U.S. dollar index Monday morning is limiting gains in the precious metals. December gold last traded up $2.60 at $1,685.60 an ounce. Spot gold last traded up $4.60 an ounce at $1,685.00. December Comex silver last traded up $0.087 at $32.26 an ounce. Gold is seeing some buying support coming from firmer crude oil prices that hit a fresh four-week high overnight. Crude oil bulls have upside technical momentum to suggest prices can trade sideways to higher in the near term. That is bullish for the precious metals. However, the U.S. dollar index is trading higher Monday morning on some short covering following recent selling pressure, and that’s limiting buying interest in gold and silver. The dollar index bears still have some downside near-term technical momentum on their side. Some chart damage has been inflicted to suggest the dollar index has put in a near-term market top. The weekend G-20 meeting in Paris produced more rhetoric from European officials attending the event. Reports said the group wants to see the European Union debt and financial crisis firmly dealt with, but no solid plans are yet in place to do such. Despite the market place now starting to look past the EU debt and financial crisis, that situation remains a mess that can’t be cleaned up easily or quickly. Thus, it will continue to be a major underlying bullish factor for the gold market that could support the precious yellow metal for weeks and months to come, or even longer. U.S. and European stock markets are firmer Monday. It’s more of a “risk on” day in the market place in early trading. These risk-on days recently have been more bullish than bearish for the gold market. One reason for this is that gold has tended to follow the general price trends in the raw commodity sector—and that sector tends to fare better when there is more risk appetite in the market place. Recent strong physical demand for gold from China and India has supported gold prices. The upcoming Diwali festival in India finds stronger demand for physical gold coming out of that nation. U.S. economic data due for release Monday includes the Empire State manufacturing survey, and industrial production and capacity utilization. The London A.M. gold fixing was $1,689.00 versus the previous P.M. fixing of $1,678.00. Technically, gold futures bulls have gained upside near-term technical momentum recently. Gold prices have been trending higher on the daily chart for the past three weeks and prices hit a fresh three-week high overnight. Bulls’ next upside technical objective is to produce a close above solid technical resistance at $1,705.40. Such would provide the bulls with better upside technical momentum to suggest the uptrend can continue. Bears’ next near-term downside price objective is closing prices below psychological support at $1,600.00. First resistance is seen at the overnight high of $1,696.80 and then at $1,700.00. First support is seen at the overnight low of $1,677.60 and then at Friday’s low of $1,662.50. December silver futures bulls have also gained some upside technical momentum recently. Silver prices have also been trending higher from the September spike low. Silver bulls’ next upside price objective is producing a close above strong technical resistance at $33.585 an ounce. Such would suggest the silver market has put in a near-term low and prices can continue to trend higher. The next downside price breakout objective for the bears is closing prices below solid technical support at $30.00. First resistance is seen at the overnight high of $32.675 and then at last week’s high of $33.10. Next support is seen at the overnight low of $31.93 and then at $31.50. Follow me on Twitter to immediately get the very latest market developments. If you are not on board, then you are not getting key analysis and perspective as fast or as often as you could! Follow me on Twitter to get my very timely intra-day and after-hours briefs on precious metals price action. The precious markets will remain very active. If you want market analysis fast, and in after-hours trading, then follow my up-to-the-second precious metals market perspective on Twitter. It’s free, too. My account is @jimwyckoff.

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