(Kitco News) -Comex December gold futures closed sharply higher and closed at a fresh three-week high close Monday. The precious yellow metal was boosted by a sharply lower U.S. dollar index and sharply higher crude oil prices. Precious metals traders Monday decided Monday to focus more on the aforementioned bullish “outside markets” and to ignore the potentially bearish aspect of the improved prospects for shoring up the European Union’s sovereign debt problems. December gold last traded up $37.50 an ounce at $1,673.30 an ounce. Spot gold last traded up $33.00 an ounce at $1,672.25. December Comex silver last traded up $0.997 at $31.99 an ounce.

The U.S. dollar index traded sharply lower Monday as the Euro currency gained against the greenback on the improving sentiment regarding the EU debt crisis. The dollar index bulls have faded recently after seeing a very good month of September. Meantime, crude oil futures prices traded sharply higher Monday. Crude oil bulls have gained good upside technical momentum recently to suggest that price action last week produced a near-term market low in crude. The weaker greenback and stronger crude were fully bullish for the precious metals markets Monday.

U.S. and European stock markets were firmer Monday on some positive weekend developments coming out of the European Union, regarding its sovereign debt crisis. The leaders of the two biggest EU economies—Germany and France—have pledged to fully support efforts to fix the EU debt and financial crisis and come up with a comprehensive plan to do so by the end of the month. While the EU debt crisis is far from being fully repaired, the market place has reckoned the matter is not getting worse and traders are now focusing on other matters.

There was no U.S. economic data due for release Monday due to the Columbus Day holiday.

The London P.M. gold fixing was $1,661.00 versus the previous P.M. fixing of $1,652.00.

Technically, December gold futures prices closed near the session high Monday and closed at a fresh three-week high close. Bulls' next upside technical objective is to produce a close above solid technical resistance at $1,705.40. Bears' next near-term downside price objective is closing prices below strong technical support at the September low of $1,535.00. First resistance is seen at last week’s high of $1,681.50 and then at $1,705.40. First support is seen at $1,750.00 and then at Monday’s low of $1,639.90. Wyckoff's Market Rating: 5.0.

December silver futures prices closed nearer the session high Monday. Silver bulls' next upside price objective is producing a close above strong technical resistance at $33.585 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at last week’s low of $28.435. First resistance is seen at Monday's high of $32.36 and then at last week’s high of $32.85. Next support is seen at $31.50 and then at Monday’s low of $31.215. Wyckoff's Market Rating: 5.0.

December N.Y. copper closed up 1,000 points 337.35 cents Monday. Prices closed near the session high again today and hit a fresh two-week high. The key "outside markets" were again bullish for copper, as the U.S. dollar index was sharply lower, while crude oil and stock index prices were sharply higher. Copper bears do still have the overall near-term technical advantage as a nine-week-old downtrend is still in place on the daily bar chart. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 350.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 300.00 cents. First resistance is seen at Monday's high of 339.10 cents and then at 340.00 cents. First support is seen at 335.00 cents and then at 330.00 cents. Wyckoff's Market Rating: 3.5.

Follow me on Twitter! If you want daily, or nightly, up-to-the-second market analysis on gold and silver price action, then follow me on Twitter. It's free, too. My account is @jimwyckoff .

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

Don’t Miss a Word! Read Kitco News on the Go with Kcast Gold Live for iPad! Get it now!

<<Back to more Kitco exclusive news