GBP/USD flirting with daily highs near 1.2860

The Sterling has bounced off session lows in the 1.2800 neighbourhood and is now pushing GBP/USD to test the area of daily tops in the 1.2855/60 band.

GBP/USD supported near 1.2800

Spot found decent support in the vicinity of the 1.2800 handle on Wednesday, just to regain buying interest soon afterwards despite the better sentiment surrounding the greenback.

Cable rallied more than 2% on Tuesday after UK’s PM Theresa May unexpectedly announced early elections on June 8. Analysts, however, stay sceptical of the extent and duration of the up move, particularly in light of the upcoming Brexit negotiations, which remains the more relevant driver for GBP in the months to come.

Absent releases in the UK should leave the attention to the US calendar, where the Fed will publish its Beige Book later today preceded by the EIA’s report on crude oil inventories and the speech by Boston Fed E.Rosengren (2019 voter, hawkish).

GBP/USD levels to consider

As of writing the pair is up 0.09% at 1.2854 facing the initial resistance at 1.2904 (high Apr.18) followed by 1.3125 (high Sep.22 2016) and then 1.3279 (high Sep.15). On the other hand, a breach of 1.2623 (200-day sma) would expose 1.2521 (20-day sma) and finally 1.2513 (low Apr.18).