Gold prices are moving higher this morning in early trade, with the yellow metal reclaiming the psychologically important $1200 level.

While several factors may potentially drive action in the gold market this week, it may be all about Greece. There is word circulating that the embattled country has reached a debt restructuring deal with its creditors, however, nothing has been confirmed as of yet.

It is unknown how a deal might affect gold and precious metals. On one hand, should a deal be reached, risk appetite may once again accelerate boosting stocks and risk assets in the process. On the other hand, the dollar index may see some selling come in as risk aversion subsides, and potentially boost gold and precious metals in the process.

It will be a data-rich trading week. This morning, investors got the latest data on consumer income and spending. Consumer spending was weak, while income levels rose. Manufacturing data also released already today showed an increase in manufacturing.

Also due out this week is motor vehicle sales, factory orders, ISM Non-Manufacturing, ADP employment report, Beige Book, weekly jobless claims, PMI Services Index and non-farm payrolls data for May.

In addition to all of this data, there will be a number of Fed officials speaking this week.

Friday’s jobs data will likely be very closely scrutinized as investors continue to look for clarity on interest rates. The overall data stream has continued to show some weak spots, and a disappointment in the jobs data could increase the likelihood of the Fed remaining on hold for the time being. On the other hand, should the jobs data show strength, it may increase the likelihood of a July or September hike by the central bank.

Gold is making a bullish outside day today on the chart, and may be poised for further upside. It is likely that today’s move above $1200 is squeezing some shorts out of the market, and bargain hunters have once again stepped in to buy at current levels. The mid-May high around $1232 remains a near-term target for the bulls, while the $1180 area has once again acted as support.

Gold’s fortunes, or lack thereof, will likely be determined in the coming weeks by Greece and any developments on a debt restructuring deal, as well as the Fed and price action in the dollar index. Gold seems to have already discounted an initial hike from the Fed, and may potentially rise in spite of an interest rate hike.