* FTSEurofirst up 0.2 percent; gains for 3rd straight day
* Mining shares feature among top gainers
* Technical factors, economic data support market
By Atul Prakash
LONDON, Aug 15 (Reuters) - European equities drifted higher on Monday, adding to sharp gains in the previous session as economic numbers revived hopes that the global economic recovery could remain on track, while firmer metals prices prompted investors to buy mining stocks.
The market also witnessed some technical buying as key stock indexes had become oversold following a heavy sell-off in the past two weeks, analysts said.
However, lingering concerns about the ability of European policymakers to effectively handle the euro zone debt situation and contain the crisis from spreading to some other countries such as Spain and Italy forced investors to stay cautious.
Miners featured among the top gainers, tracking a rise in key base metals prices on hopes of improving demand for raw materials. The mining index rose 0.6 percent, while BHP Billiton rose 1.1 percent.
At 0816 GMT, the FTSEurofirst 300 index of top European shares was up 0.2 percent at 969.72 points. The index surged 3.7 percent on Friday, helped by strong U.S. retail sales figures. Data on Monday showing Japan's GDP shrank less than expected in the second quarter also improved sentiment.
NOT AS WEAK
"If America is not as weak as had been suggested, and we now get a bit of rebound out of Japan, then that's something to go forward," said Mike Lenhoff, chief strategist at Brewin Dolphin.
"The markets have been technically very oversold and on that basis alone, they are due for a period of remission from the selling. Although there are a lot of concerns about the way in which earnings are going to go, the results on balance have been quite good."
Technical analysts said the stock market was expected to see a pause in the downtrend or even witness a short-term technical rally after suffering heavily in the past two weeks, during which time key European indexes plunged to two-year lows.
The Euro STOXX 50 , the euro zone's blue chip index, was up 0.7 percent at 2,323.96 points. Analysts said important pivot points for the index would be 2,352 and 2,437 -- the 38.2 percent and 50 percent retracements from the July-August sell-off.
"Especially the latter is important to watch as it is also near the gap on the daily candlestick chart at 2,412, which was filled but not closed during more than three sessions, making that area a strong resistance," said Dmytro Bondar, technical analyst at RBS.
"Unless the price manages to close above the 2,412 level, I would expect further declines in the price action when the correction ends. Important levels on the downside include 2,246, 2,077 and 1,907." (Editing by David Holmes) ============================================================ For rolling updates on what is moving European shares please click on ============================================================ For pan-Europeanmarket data and news, click on codes in brackets: European Equities speed guide................... FTSEurofirst 300 index.............................. STOXX Europe index.................................. Top 10 STOXX sectors........................... Top 10 EUROSTOXX sectors...................... Top 10 Eurofirst 300 sectors................... Top 25 European pct gainers....................... Top 25 European pct losers........................
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