This weekend was great for sports. Major NFL games had a lot of people glued to their televisions on Sunday. Me, and many other Canadians, watched Canada inch one step closer to the FIFA World Cup (our first since 1986) after beating the United States 2-0 in a chilly Hamilton, Ontario. Being a professional wrestling fan, the end of January is the most wonderful time of the year. Yes, it is our Christmas. Why is that? The Royal Rumble.

30 men and 30 women partake in a rumble, where the rule of elimination is the wrestler must be tossed over the top ropes with both feet making impact with the ground. The winner of each rumble gets to Main event Wrestlemania in April. WWE calls this part of the wrestling season as “The Road to Wrestlemania”. The hype train begins to build. The winners of the Rumble, and the stars that will headline Wrestlemania are Ronda Rousey and Brock Lesnar. Two superstars that are WWE’s biggest gate box office attractions.

This year’s Royal Rumble has received mixed reactions from the fans. Okay, it is mostly negative. Looking at comments on popular Wrestling Youtube channels, fans consider this to be the worst Royal Rumble in years. The Royal Rumble gets us excited because there are always surprises. A major return, maybe some legends come back for one last hurrah. We did get some in the women’s Royal Rumble, but not anything in the men’s.

This actually is a good summary of WWE’s product recently. It hasn’t been the best. I am just being nice, but other fans would use the words, “boring”, “stale”, “sh*t” to describe WWE’s product. Fans are largely upset. Their two main shows are WWE Raw on the USA Network, and WWE Smackdown on Fox. Raw lost me as a viewer a long time ago because the 3 hour show was just boring. Smackdown on Friday is perhaps the best WWE product right now, with engaging storylines thanks largely to Roman Reigns.

This has led to some rumours about backstage morale. According to PW Insider, after Saturday’s Royal Rumble, the WWE locker room morale is low compared to most recent WWE events. WWE has been losing some fans because of the major talent they have let go…when the company is bringing in record profits. This is leading to a rumour that perhaps Vince McMahon is looking to sell WWE. Getting rid of superstars and some backstage employees to make the balance sheet look good.

A lot of talk about Disney buying WWE. Heck, it would be great for their streaming platform. This rumour has received some legs as recently, as Disney and WWE have made a streaming deal. Maybe step 1 in an actual acquisition. WWE have agreed to an international streaming deal with Disney that will see Disney+ Hotstar become the exclusive home of the WWE Network in Indonesia. Beginning on January 30, major WWE events will be available on the service as part of a standard subscription and programming will be available in Indonesia’s local language, Bahasa Indonesia, and English. The companies are understood to have held preliminary discussions for other territories as well. I am sure the speculation will just grow.

WWE stock is in an interesting position. The stock is holding a major support zone on the back of a Disney deal, the Royal Rumble, and earnings coming out this week on February 3rd 2022. The price action after the last 3 earnings haven’t been great. The stock drifted lower post earnings. If we repeat this for a fourth time, the stock could break below this major support which would be bearish. Some people even say this is a broader head and shoulders pattern.

In the recent stock market route, WWE has actually held up well. It has ranged for multiple days at this support zone. I think this has to do with the company being a value stock with its dividends.

As much as people may rip on their products, the fans still tune in. In terms of live events, I have seen videos and heard that their house shows see a lot of empty seats. But this could be due to fears of Covid, or the US consumer not having the funds in that part of America rather than fans not going because the product sucks. We should not forget WWE’s deal with Saudi Arabia. We are talking tens of millions of dollars, and WWE superstars are set to perform in Jeddah, Saudi Arabia in February 2022.

Very strong price action today, and prices are looking to break above my moving average. More importantly, prices are looking to break above the range the stock has held since January 24th 2022. A close confirmation above this level today, could see a nice run up pre earnings, potentially up to $54. If post earnings we break $54…then there is a lot of room to the upside. We would be looking at the $58-$60 zone as our next resistance target.

Even though the company is losing fan support, and seeing some fans switch over to WWE’s competition, AEW, we cannot deny the money making machine that is the WWE. Viewership is not dropping. With the Disney deal potentially leading to much more, and Wrestlemania around the corner, WWE is standing in a good spot financially, and during a time when professional wrestling is getting even more popular.