ZFX: Traders are closely watching the Sterling amid potential Brexit chaos

On Tuesday, stocks in Asian markets were mostly higher following the momentum overnight in Wall Street. AstraZeneca has restarted the clinical trials of its Covid-19 vaccine in UK first, boosting optimism among investors. On the other hand, Pfizer Inc and BioNTech may expand their vaccine trial in phase three.

Investors in Europe are calming down, with a mixed opening in European markets. Traders are closely monitoring the risk of hard Brexit, as the UK government has passed the controversial bill, which is deemed as a violation of the Brexit agreement.

The EU has warned the UK that the bill would hurt the trade deal ahead, and the EU will prepare for the worst, letting UK to leave without any deal. The Sterling bounced back to 1.29 level against dollar on Monday US session, but dropped back to 1.2850 area for closing. Despite improved risk appetite and the slip of dollar, Sterling is clearly bearish. The dollar index broke 93 mark again on Tuesday earlier trading session.

ZFX analyst Jacob Leung said that, hopes for a Covid-19 vaccine once again helped market sentiment. However, we should be noticed that sentiment is always sensitive, and it would be still too early to judge the end of the market adjustment. This week, the FOMC meeting is coming ahead. Any new policy stance or speculation may be the new market drivers.

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