GBP/USD surges through 200-DMA for the first time since Brexit vote

The GBP/USD pair continued scaling higher and surged through the 1.2600 handle, and the very important 200-day SMA hurdle, to hit the highest level since early Feb.

Currently trading around 1.2670-75 region, the earlier retested the key 1.25 psychological mark support but quickly reversed course after the UK PM Theresa May called for snap elections on June 8th, to guarantee stability for coming years. 

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Early election would shorten the two-year window for Brexit negotiations, but is unlikely to alter the path. Moreover, possibilities of a strong performance in the election would further boost May's confidence in her Brexit negotiation strategy, which eventually is supporting strong buying interest surrounding the British Pound. 

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Technically, the pair has moved above the very important 200-day SMA for the first time since the historic Brexit referendum and hence, a follow through momentum beyond the current resistance area (representing 61.8% Fibonacci expansion level of mid-March up-move and subsequent retracement) should pave way for continuation of the pair's strong bullish trajectory in the near-term. 

Technical levels to watch

Immediate resistance is pegged near the 1.2700 handle (yearly high), above which the pair is likely to dart towards 1.2725-30 resistance (Dec. 2016 monthly highs) ahead of 1.2775 level (early Nov. high).

On the flip side, any retracement back below 1.2630 region (200-day SMA) now seems to find immediate support near the 1.2600 handle. Any further weakness below the said handle should now be limited at a medium-term descending trend-line resistance break-point, now turned strong support near 1.2580 region.