Last Wednesday, spot gold soared to an all-time high of $1,070.40 an ounce, while New York gold futures hit a record peak of $1,072 as the greenback's weakness spurred buying of gold, which became less expensive for holders of other currencies.
The precious metal is also often bought as a hedge against a depreciation in the U.S. currency.
"The dollar is recovering a touch against the euro, and that is putting pressure on gold," said Kazuhiko Saito, chief analyst at Tokyo's Fujitomi Co Ltd.
He said funds were shifting from gold to the crude oil and stock markets, as the precious metal has lost some of its attraction as an inflation hedge and a safe haven.
Gold was at $1,051.80 per ounce at 0601 GMT, up 0.1 percent after earlier rising to $1,055.20.
U.S. gold futures for December delivery were at $1,052.10 per ounce, also up about 0.1 percent.
The euro backed off a 14-month high against the dollar and a two-month high against the yen as investors trimmed long positions on caution over what euro zone finance ministers might say about its recent strength.
"My view is that gold's probably going to consolidate around current levels," said Adrian Koh, an analyst at Phillip Futures.
Koh said gold trade was quiet and he was waiting for further direction for the market.
Fujitomi's Saito also believes gold will trade around $1,050 for the time being until crude oil, which has not been rising at the same pace as gold, catches up.
U.S. crude oil steadied after hitting a 12-month high above $79 a barrel on Monday.
It is still down more than 40 percent from its record high above $147 marked in July 2008.
"I think gold is waiting for crude oil to top $80 before rising again on inflation fears," Saito said.
The rise in speculative net long positions to a record last week was also putting pressure on the gold market, Saito said
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