Pound Firms; U.S. Dollar Drops As European Stocks Gain

The pound climbed against its major counterparts in the European session on Tuesday, as European stocks rose following positive cues from Asia, amid a gain in commodity stocks.

Oil rebounded following a selloff on Monday as investors reassessed the risks from the Omicron variant.

Moderna announced on Monday that a booster dose of its Covid-19 vaccine increased antibody levels against Omicron.

The currently authorized 50 microgram booster dose increased neutralizing antibody levels against Omicron approximately 37-fold compared to pre-boost levels.

In another development, Senate Majority Leader Chuck Schumer said that there will be a vote on a revised version of the Build Back Better Act in January.

In the U.K., PM Boris Johnson said that fresh curbs are unlikely to be imposed before Christmas, but cautioned that the situation was "extremely difficult".

The PM added that the government is looking to keep Omicron under control and cannot rule out implementation of additional measures after Christmas.

The pound was up at 4-day highs of 1.3261 against the greenback and 150.78 against the yen, following its prior lows of 1.3197 and 149.89, respectively. Next key resistance for the pound is possibly seen around 1.34 against the greenback and 153.00 against the yen.

The pound edged higher to 0.8507 against the euro and 1.2224 against the franc, rebounding from its early low of 0.8549 and near a 2-week low of 1.2144, respectively. The pound is seen finding resistance around 0.84 against the euro and 1.24 against the franc.

The safe-haven dollar fell amid an improvement in risk sentiment.

The greenback weakened to 1.1303 against the euro, from a high of 1.1273 seen at 7:00 pm ET. The greenback is likely to face support around the 1.14 region.

The greenback touched 4-day lows of 0.7137 against the aussie and 0.6759 against the kiwi, down from its early highs of 0.7099 and 0.6703, respectively. The next possible support for the greenback is seen around 0.74 against the aussie and 0.69 against the kiwi.

The greenback retreated to 1.2924 against the loonie and 113.56 against the yen, from its early high of 1.2947 and a 4-day high of 113.77, respectively. The greenback is poised to find support around 1.26 against the loonie and 112.00 against the yen.

The greenback declined to 0.9195 against the franc at 3:30 am ET, but it has since rebounded to 0.9226. The greenback may test resistance near the 0.93 level.

Looking ahead, Canada retail sales for October will be featured in the New York session.

Eurozone flash consumer sentiment index for December will be out at 10:00 am ET.