NEW YORK (TheStreet ) -- Gold prices were drifting lower Monday as investors took profits after gold's record rally last week.
Gold for December delivery was slipping $2.50 to $1,342.80 an ounce at the Comex division of the New York Mercantile Exchange. The gold price Monday has traded as high as $1,356.30 and as low as $1,342.10.
The U.S. dollar index was inching up 0.03% to $77.20 while the euro was down 0.06% to $1.39. The spot gold price was down more than $5, according to Kitco's gold index.
Gold's 2% rally in October has triggered some profit-taking and investors were also buying stocks instead of gold in anticipation of more monetary easing from the Federal Reserve. The minutes from the Fed's previous meeting are due out Tuesday, which will help provide direction as to how the Fed is likely to act.
Chairman Ben Bernanke has come out in opposition of raising the inflation target, which meant that the Fed would run its printing presses for longer to reach a higher inflation rate over an extended period of time.
Nevertheless, it seems like some type of government bond purchase program, whether long or short term, will happen especially after Friday's weak unemployment report. There are dissenting voices in the Fed on how the central bank will pump more money into the system so traders will be eyeing the Fed minutes to provide direction.
Most analysts think that investors will keep hedging their riskier bets with gold and the prices will head higher despite intermittent profit-taking and minor corrections.
"I have actually been buying some puts on some major mining companies as a hedge," says David Morgan, founder of Silver-Investor.com. "There's a lot more people on the bullish side than bearish side ... I'm just putting a little protection on here."
The annual meeting of the International Monetary Fund and world bank leaders over the weekend proved that there is no end in sight to the recent currency battles that have been brewing. Countries, particularly those from emerging markets like Brazil, have been trying to lower the value of their currencies in order to help export demand.
Leaders were trying to nudge China to let its currency rise quickly in value to help other countries, but no agreement was reached. Signs of currency fragility are good long term for gold prices because the metal shines as an alternative form of money that can't be inflated.
