Can I move file winxp.pvm to external drive?

I have a 7.7 GB file winxp.pvm in my Macbook Pro internal drive under user/libraries/parallels. Can I simply move the file to an external drive (1.5 TB) to reclaim disk space on my internal drive? (Can I then safely delete the file on the Mac HD?) If I move the file to the external dirve, will the file size keep growing until it takes up 50 percept of the 1.5 TB space before automatic compression kicks in?