Monday, January 6, 2025

One eye on the squared circle

Starting the week with some rotten speculation
 
   
     
   
 
January 6, 2025
   

Editor’s Note: If you want to listen to some brilliant traders who actually know what they’re talking about and want to follow one of their best trade ideas, then join Nate and Lance right here. Lance is placing a trade LIVE on camera targeting a lot… because he’s that confident in it. And you can follow along! Just join them here

Hey y’all,

Wanted to start the week off with a potential (and I do emphasize potential) trade I’m taking a look at before today’s close.

But before I do that, let me just say this…

Pretty much across the board, our experts at ProsperityPub agree that “trading the news” is bad, little better than speculation.

You have semi exceptions, like Lance Ippolito and his incredible “News Flow Scanner.” But even there, he’s not really trading the “news” so much as he’s trading off the massive reactions Wall Street investors make.

And beyond that, almost everybody on our team would tell you that basing a trade purely on speculation is a bad idea.

Which is the main reason I’m not already in a trade on TKO. 

Because I’m waiting to see any sort of confirmation that it’s a good trade besides the narrative I’m about to tell you, and right now, the call of the price and the stock is dropping like a fly.

However, I’m still keeping an eye on it and here’s why:

TKO is the parent company of UFC and WWE.

Tonight, WWE’s flagship weekly show, RAW, makes its jump to Netflix to kick off a $5 billion agreement they made to carry the show for 10 years.

To say that they’ve pulled out the stops to make this a deal on both sides is an understatement.

You can hardly turn on Netflix without an advertisement for the debut, and last night, they flew a drone show over the streets of Los Angeles to hype the event in the Intuit Dome:

 

 

While streaming services have dabbled in live sports before, whether Amazon with Thursday or even Netflix with the infamous Paul/Tyson fight, this marks a major step forward even for Netflix; a ten-year investment in the bargain that LIVE entertainment with a devoted fanbase will draw more viewers to their platform.

For WWE, it marks the first time RAW has been off of cable television in three decades, since its debut in January 1993. They are fond of parroting the boast that they are “the longest-running weekly episodic television show in history,” but now the very nature of their “television” agreement is changing.

All of that to say, there will be a lot of hype around WWE and, by extension, TKO in the coming days…

Which is why I thought I might buy into the $146.14 calls this morning and see what happens…

But, unfortunately, the voices of the better angels of ProsperityPub are ringing in my head when I look at this chart:

 

 

TKO tried to make the gap up overnight, but it fizzled out and has been dying all morning. As I write this (10:50 AM) it looks to be bouncing back higher, but I’ll need to see it make some real progress before I get back in.

So, the lesson to be learned here is: don’t assume the headlines are going to move the markets.

No matter how transformative a day might actually be for a company, the markets have to buy into that narrative for anything to actually move.

Fundamentals are way more important…

With that said, if I do get in, I’ll let everyone know over on Telegram so that when it blows up in my face, you can all laugh at me! 

To your prosperity,

Stephen Ground
Editor-in-Chief, ProsperityPub

 

   
 

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