The pound soared to almost $1.30 and €1.16 following the news a Brexit deal had been reached between the UK and EU.
It's the highest the pound has traded against the dollar since May 14, shortly before Theresa May resigned as Prime Minister.
But that initial surge was soon pegged back, as the chances of the deal getting through Parliament reduced.
At the time of writing the pound is trading at 128.7 cents against the dollar and 115.7 cents against the euro.
Currencies Direct market analyst Phil McHugh said: "The initial surge in the pound on the news has been capped by rumours that the DUP still have concerns over VAT arrangements which has put a bit of a dampener on the pounds run higher for now."
Nigel Green, founder of deVere Group, said: “That said, there does seem to be a growing sense of optimism that it can get approved.”
“If this deal is ratified, we can expect the pound to jump sharply. It is likely to hit at least $1.35 as the prospect of a no-deal, and/or months of further uncertainty ends."
Of course, the reverse is also true.
"If [the deal] it fails like snakes and ladders it will be a sharp move lower back towards 1.22," McHugh said.
And even if the deal does go through - the future for the pound can't be guaranteed.
“This is really just the beginning – not the end," Green said.
Andy Scott, Associate Director at JCRA, said: “Sterling has seen a dramatic couple of weeks. Rallying 6% versus the dollar and 5% versus the euro from its lows last Thursday, the currency’s best performance against the dollar since 1985!
"However, Sterling still remains relatively weak. At the current level of 1.29 versus the Dollar and 1.16 versus the euro, sterling is still down 13% and 11% respectively compared to its peak on the eve of the referendum result."
