The non-saturated economic calendar makes the British pound the most interesting currency of the week by December 14th. Of course, statistics on the labor market of Foggy Albion is important, but voting in parliament on the agreement with the EU proposed by Theresa May is more important. How many pieces will sterling lose if parliamentarians vote against? In June 2016, on the day of the referendum on EU membership of the country, the GBP / USD pair slipped from 1.5 to 1.32. In January 2015, when the Swiss National Bank was stunned by the financial markets with a decision to drop the floor at 1.2 under EUR / CHF, the USD / CHF pair collapsed from 1.02 to 0.83. What happens once may never happen again, but what happens twice will surely happen a third time. Do traders have the right to wait for crazy moves?

If a few weeks ago, Bloomberg experts, issuing a forecast of a pound falling to $ 1.2 and below in the case of a document rejected by parliamentarians, spoke of disorderly Brexit and political chaos (the most bearish estimates suggested a drop of GBP / USD to 1.1), by December the situation had changed. The European Court stated that London could unilaterally cancel article 50, because of which all the fuss began. Simply put, the absence of a treaty with the EU is not a catastrophe, in this situation, there is the possibility of abandoning the so-called divorce. With or without a second referendum. In my opinion, only the approval of the Theresa May project can reduce uncertainty and volatility, which will provide the sterling a springboard for growth in the direction of $ 1.35. In other hands, it will continue to be under pressure.

Pound Volatility Dynamics

There is a possibility that a slight loss of the prime minister in parliament will give her the opportunity to re-vote. According to Barclays, CIB, BlackRock, UBS and Mizuho Bank, if Theresa May gets 270-300 votes out of 320, the pound will remain stable and you can think about buying it in the near future.

Politics takes economic events to the background. On the same day, when British lawmakers decide on Brexit, statistics on the labor market of Albion will be released. Judging by the increase in unemployment from 4% to 4.1%, the increase in the number of applications for benefits and the employment reduction expected by Bloomberg experts, the situation is starting to worsen. It would be strange if it were otherwise because, on the background of a divorce from the EU, foreign workers leave the labor market. On the other hand, leaving low-paid employees leads to an acceleration of wages for the British. Good news for the economy, because extra money can be spent on consumption, and not very good for the Bank of England. The average wage is a leading indicator of inflation. Overclocking the latter will cause BoE to raise the repo rate.

Technically, the inability of the "bulls" on GBP / USD to return the quotes of the pair within the triangle indicates their weakness. A break of support at 1.265 will increase the risks of continuing to a peak in the direction of the target by 161.8% on the AB = CD pattern.

GBP / USD, the daily graph