GBP

The pound largely rebounded from its overnight losses, as traders speculated the BoE might take emergency action to stem the currency's fall.

A trade through 1.0349 will signal a resumption of the downtrend. The main trend is down according to the daily swing chart. If this is able to generate enough upside momentum the look for a possible near-term surge into the short-term 50% level at 1.1043. Since the main trend is down, look for sellers on the first test of this level. If this creates enough downside momentum then look for a retest of 1.0349. Overcoming it, however, could extend the rally into the short-term Fibonacci level at 1.1207. Traders are reacting negatively to the unveiling of new Finance Minister Kwasi Kwarteng’s historic tax cuts, funded by the biggest increase in borrowing since 1972. One of the reason upsetting investors is that the government is going to be funding the tax cuts as interest rates are rising, which is making to make the plan very expensive. The loss could have been worse if not for a solid intraday technical bounce that brought the currency back above the session’s mid-point. The short-term range is 1.1738 to 1.0349. [GBP/USD](https://www.fxempire.com/currencies/gbp-usd) settled at 1.0686, down 0.0170 or -1.59%. The British Pound closed lower against the U.S.