Gold held flat in what dealers called "subdued trading" early in London on Tuesday, returning from the Christmas holidays to record an AM Gold Fix at a one-week high of $1103 an ounce.
The Gold Price in Euros and Sterling also hit one-week highs, reaching above €765 and £689 an ounce respectively.
World stock markets extended their "Santa Claus rally", pushing London's FTSE100 to fresh 2009 highs above 5,440.
Crude oil slipped one Dollar from Monday's surge to $79 per barrel on the north-eastern United States' cold snap.
"The Dollar's recent firmness was partly due to the covering of excessive short positions," reckons Koichiro Kamei of Japan's Market Strategy Institute, speaking to Reuters.
"That adjustment seems to be coming to an end. Gold's correction may also be over, and talk of central bank buying will again be the main driver."
The US Dollar fell towards a two-week low to the Euro on the currency markets early Tuesday, but held steady against the "safe haven" Japanese Yen at ¥91.70.
UK government bonds sold lower again, pushing the yield offered by 10-year gilts up to a new 2009 high of 4.08%.
German 10-year Bunds yielded 3.37%. US Treasury bonds offered 3.85% on the 10-year note.
New data released by US regulator the Commodity Futures Trading Commission said the total number of Gold Futures and options contracts held open through New York's Comex exchange shrank half-a-per-cent last week to its lowest level since the start of November.
That was just before the Gold Price began a run of fresh all-time highs, adding 12% to $1226 an ounce, on news that the Reserve Bank of India had bought 200 tonnes of bullion for its currency reserves.
Hedge funds and other large speculators last week cut their bullish betting and grew their bearish positions, the CFTC's data showed, helping shrink the "net long" position held by non-gold-industry players by more than 5% to the equivalent of 937 tonnes.
"While we have always believed gold should be a small part of a diversified portfolio, we did not want to see widows and orphans put their life savings into it," warns a spokesman for the BlackRock Gold and General fund – this decade's best-performing investment fund globally – quoted by South Africa's Business Standard.
"In terms of technical trends, the prospects for gold look strong, but the underlying fundamentals look weak," says a note from Barclays Capital in London, pointing to a third year of falling jewelry demand in the face of record-high Gold Prices.
The collapse in India's gold demand – likely to fall to at least an 18-year low for 2009 at 336 tonnes – has seen the former world No.1 over-taken by Chinese households, now set to have bought up to 443 tonnes this year.
Global Gold Mining supply is likely to show a small uptick for 2009, but the underlying trend continues to point lower as ore grades decline, mining costs rise, and the political barriers to new mining projects grow – both from acquisitive governments in less stable, gold-rich parts of the world, as well as from the environmental lobby.