The country is torn in pieces. The prime minister has already lost some of its chess pieces, and this time 'the queen' is 'in check' herself. The news broke that 40 Conservative members of Parliament have agreed to sign a letter of no-confidence in Theresa May. They need only 8 voice votes to initiate the process of changing the leader.
Last week the Pound showed resilience in spite of the uncertainty around the disruptive Brexit. This time GBP could not stand the news. The currency slumped 0.7% against the dollar and tested the lows at 1.3061. The political factors are too strong, and it will be difficult for the economic data to draw markets’ attention. The bulls will expect some hawkish or, at least, consolatory comments from the Bank of England's Governor Carney this week.
At the same time, ‘the lion's share’ of attention will concentrate on the UK the data.
The downside is limited by November, 2-3 support line at 1.3040-50. Anyways, GBP/USD has to surpass the 1.3200-30 area to start the sustainable growth.