Neither gold nor silver did much of anything in early Tuesday morning trading in the Far East.

However, once Sydney closed, the prices began to rise slowly all through early London trading. About 30 minutes before trading began on the Comex (AMEX:IAU) in New York, both metals really began to tack on some much bigger gains. This activity level continued until just about the time that the Comex closed. From that point on, both metals (especially gold) got sold down a little in after hour trading on the Globex.

Although both gold and silver put in some fine gains, I got the feeling that there was monkey business going on in the HUI starting a few minutes before lunch time in New York. There was absolutely no reason whatsoever for the shares to get sold off, but they did. Tuesday’s action was counterintuitive …similar to two Monday’s ago when both metals got shellacked big time…but the gold shares were up on the day. As I said at the time, I believe that the boyz buy these shares at times like that just to sell them into rallies like we were having yesterday.

Anyway, there wasn’t big volume yesterday, but in a conversation I had with Ted Butler, he’s happy that there are no big increases in the silver open interest as this rally continues. Open interest for Monday in gold was very impressive, as the tech funds piled in on the long side and the bullion banks went short against them. Monday’s gold o.i. was up 9,657 contracts on gold’s $3 loss on the day. Silver o.i dropped by 563 contracts…but don’t forget, there were 1,322 contracts delivered into on Monday, so silver open interest was actually up about 760 contracts.

In gold news, I see that the ECB (European Central Bank) announced a 30 tonne sale of its own gold holding and further announced that this would be the last sale until the next year of official sales that starts at the end of September. Of course, banks subordinate to the ECB can still sell if they wish to. The link to the story is here.

In other news, I note in a story in The Telegraph, the headline reads “British household debt is highest in history”. And in a Reuters story, Peruvian miners started a nation-wide strike at midnight Sunday night. The Iranians have threatened to block shipping in the Straits of Hormuz in case of war…the U.S. Navy says “no way”. And a US Defence department official says that “Israel is increasingly likely to attack Iranian nuclear facilities this year”. The dogs of war are straining at the leash, as an attack on Iranian nuclear facilities will undoubtedly escalate quickly. Count on it.

Today’s first story is one that I mentioned yesterday. James Turk over at goldmoney.com has a story about the US$ entitled “On the Precipice”. The story is linked here.

The second commentary today is from Ted Butler and his mentor, Israel Friedman. The title of Izzy’s latest is “The New Era” and Ted’s is entitled “A Timely E-mail from a Reader”. The link is here.

Without doubt, the hand of the President’s Working Group was all over yesterday’s markets. They’re making no attempt at all to hide their actions. As I’ve said repeatedly….”There are no markets any more, only interventions.”

All of us at Casey’s Daily Resource Plus will see you right here again tomorrow morning.

Casey Research correspondent-at-large Ed Steer is a keen observer of the financial scene and a board member of GATA.org.

Source: And Then There’s This…Wednesday, July 2nd, 2008