Archer, 24, had been edging closer to joining Scottish giants Rangers on the final day of the window in what is believed to have been a loan.
Saints sources claimed they would not allow Wolves-bound Adam Armstrong and Archer to both leave the club without suitable replacements.
Cam Archer last scored in late December (Image: Matt Watson/Southampton FC)
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A report from talkSPORT now suggests that will be the case as Southampton’s talks to sign a second striker, alongside Cyle Larin, appear to have stalled.
Saints will complete a loan deal for the Canada international to replace Armstrong, who will join Wolves for £7million and £2m in add-ons.
Archer, a £15m signing when Saints were promoted to the Premier League, has only managed three goals across all competitions this season.