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As more cases of the more contagious variant of the coronavirus are detected around the world, there’s growing concern among scientists that the nations have not done enough to track genetic changes in the virus.

The world is in the dark about the emergence of potentially dangerous new strains.

Now scientists are playing catch-up in their quest to know how widespread the variants are.

So far, at least 50 cases of the coronavirus variant first discovered in the United Kingdom have been identified in the US

In the UK, rapid spread of the variant, known as B.1.1.7, sent the country into strict lockdown following an announcement by the UK’s PM Boris Johnson on Jan. 4 as cases surged.

A new coronavirus variant has been detected in both Japan and Russia this weekend.

After seeing a steep rise in coronavirus cases, Japan declared a state of emergency for Tokyo and three prefectures neighbouring the capital on Thursday. 

A variant in Japan was found in four travellers from Brazil’s Amazonas state, Japan’s Health Ministry said on Sunday, the latest new mutation of the virus discovered.

Russia has detected its first case of the more infectious coronavirus variant found in England, in a Russian who returned from Britain and tested positive late last month, RIA news agency reported on Sunday, citing the consumer health watchdog.

Russia suspended flights to Britain last month until 13 January because of the virus variant detected in the UK. It also introduced a mandatory two-week self-isolation period for people arriving from the United Kingdom.

Meanwhile, the weekly tallies of Covid-19 cases and deaths in the United States have never been higher.

US state officials are warning of more alarming patterns following the holiday season and with ICUs filled, Los Angeles doctor says the holiday Covid-19 surge has yet to arrive.

Dr. Anish Mahajan, chief medical officer at the Harbor-UCLA Medical Center, said that intensive care units in the Los Angeles area already filled even before the expected Covid-19 surge after the holidays.

“It takes two to three weeks for patients to get sick enough to need the hospital after they’ve gotten the virus, and Christmas was only two weeks ago, and we’re already full,” Mahajan said speaking on CNN Newsroom.

Markets are looking to Pfizer

Markets are looking to Pfizer to release millions of doses each day to meet the plans of the incoming Biden administration.

“Rest assured that Pfizer is working around the clock to manufacture and is ready to release millions of doses each day, ” said Amy Rose, Vice President of Global Media Relations for Pfizer.

President-elect Joe Biden is aiming to release every available dose of the coronavirus vaccine when he takes office.

The tactic will differ from the Trump administration’s strategy of holding back half of US vaccine production to ensure second doses are available. 

Market implications

The new variant is now spreading across the globe and one of the biggest fears is that a new variant could emerge that could render the new vaccines less effective. 

Hopes are being pinned to a finding published last Thursday that the Pfizer-BioNTech vaccine works against a key mutation first discovered in the United Kingdom and South Africa.

The finding will bolster many expectations that the immune response triggered by vaccines will be broad enough to counter the new, highly contagious variants.

The study showed the immunity conferred by the Pfizer-BioNTech vaccine could block a version of the virus that contained one key mutation among the ensemble of changes found in both the UK and South Africa variants.

“I think this [study]is really important because there is a lot of fear and uncertainty at the moment about this specific question,” said Shane Crotty, a vaccine and immune system scientist at La Jolla Institute for Immunology.

More experiments and direct tests of both variants in the next few weeks will bring greater clarity in the markets which have started out the New Year cautiously optimistic and expecting a post-covid, or at east, a vaccinated world. 

Investors expect that President-elect Joe Biden’s incoming administration will pass bigger fiscal stimulus and infrastructure spending plans which have enabled US stocks to new highs and sent bonds to 11-month lows. 

The US dollar has rallied on the rise in yields and a stubbornly bullish outlook in the markets for the US economy and a vaccinated nation. 

The positioning data in the US dollar will be one to watch over the coming weeks.

Spot-FX has seen the greenback gain notably vs the CHF and JPY in particular, but its strength across the board is compelling. 

Could a sustained and weighty correction now be on the cards?

The yen’s long position for the week rose by 3K to 50K according to the latest COT data. 

This is a significant tally in the position now at the largest long position since early October 2016. The yen is the second most weighted currency in the basket of currencies that make up the DXY index.

On an unwind, the safe-haven US dollar would be set to pick up some of the outflows which could spur the recent recovery on even further in the index.

DXY monthly chart

The 38.2% Fibonacci retracement level meters prior support which would be expected to hold and potentially set-off the next bearish trend.