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(Kitco News) - Comex gold futures prices surged to a fresh 2.5-month high late in the U.S. day session, on safe-haven investment demand amid the European Union sovereign debt crisis that has escalated this week. August gold pushed above what was stiff overhead chart resistance to set off fresh technical buying. Gold and silver both got buying support as the trading session wore on, due to the U.S. dollar index backing way off its daily high and by crude oil prices posted a sharp rally after trading lower early on. August gold last traded up $14.10 at $1,563.30 an ounce. Spot gold last traded up $8.40 an ounce at $1,563.25. December Comex silver last traded up $0.151 at $35.865 an ounce.

World stock and commodity markets were hit hard overnight due to the ongoing European Union sovereign debt crisis that has intensified this week. The Euro currency was under strong selling pressure again on the EU concerns and hit a fresh 3.5-month low in overnight trading. Meantime, the U.S. dollar index traded solidly higher early Tuesday morning and hit a fresh 3.5-month high. But then in late-morning trading the stock markets moved well off their lows, the Euro rallied off its lows, crude oil began to rally and the U.S. dollar index backed well down from its high. All this supported a move back into the gold market.

At least some of the buying interest in gold was also due to bargain-hunting buying on the price dip.

The London P.M. gold fixing was $1,550.50 versus the previous P.M. fixing of $1,555.50.

Technically, August gold futures prices closed near the session high Tuesday and scored a bullish "outside day" up on the daily bar chart, whereby the high was higher and low was lower than the previous session's trading range, with a higher close. Prices also hit a fresh 2.5-month high. Gold bulls have the solid overall near-term technical advantage and gained more upside momentum Tuesday by pushing prices above what was strong resistance at the June high of $1,559.30. Bulls' next near-term upside technical objective is to produce a close above strong technical resistance at the all-time high of $1,577.70. Bears' next near-term downside price objective is closing prices below solid technical support at $1,520.00. First resistance is seen at $1,570.00 and then at $1,577.70. First support is seen at $1,550.00 and then at Tuesday's low of $1,541.10. Wyckoff's Market Rating: 8.0.

(NOTE: For a complete explanation of my exclusive "Wyckoff's Market Rating" just send me an email at jwyckoff@kitco.com and I'll attach it and email it back to you.--Jim)

December silver futures prices closed nearer the session Tuesday today after being under selling pressure early on. The silver bulls have the overall technical advantage in silver. The next downside price breakout objective for the bears is closing prices below solid technical support at the June low of $33.42. Bulls' next upside price objective is producing a close above solid technical resistance at $37.84 an ounce. First resistance is seen at Tuesday's high of $36.07 and then at $36.50. Next support is seen at $35.50 and then at $35.00. Wyckoff's Market Rating: 6.0.

December N.Y. copper closed up 265 points 441.00 cents Tuesday. Prices closed nearer the session high. The market was supported by the U.S. dollar index backing well off its daily high and by a solid rally in crude oil prices. The copper bulls have the solid near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 450.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 425.00 cents. First resistance is seen at this week's high of 442.95 cents and then at 445.00 cents. First support is seen at 437.50 cents and then at 435.00 cents. Wyckoff's Market Rating: 7.0.

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By Jim Wyckoff of Kitco News; jwyckoff@kitco.com

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