TJ "The Wheel Deal" PRESENTS: PREMIUM JUNKIES "COLLECT 2 CAPTURE" EP. 41

SUMMARY

TJ 'The Wheel Deal' provides a comprehensive update on his trading portfolio, focusing on high-stakes positions in Palantir, Micron, Riot, and ASST, while contextualizing market moves with the imminent U.S. midterm elections and key earnings reports. The episode combines live trade management, technical analysis, and a detailed discussion of how political events and macroeconomic factors intersect with trading strategies.

MAIN POINTS

• TJ reports a significant drawdown in his portfolio, details recent purchases of ASST and Riot shares, and discusses margin considerations. [2:00]
• A new educational segment is introduced, focusing on the impact of government and upcoming midterm elections on financial markets. [5:00]
• TJ reviews bond types and legislative risks, connecting them to ballot measures and how changes in law can affect investment values. [10:01]
• He outlines the structure of the U.S. government, what is at stake in the midterms, and how fiscal policy decisions are made. [16:00]
• Three election scenarios are analyzed: status quo, Democratic House, and Democratic control of both chambers, with implications for market volatility and legislative risk. [18:02]
• The discussion shifts to data center ballot measures, highlighting their impact on power prices, infrastructure costs, and related equities like Micron and Clean Spark. [23:04]
• Historical context is provided with the '19 for 19' midterm effect, showing the S&P 500 has always risen in the year following midterms, regardless of outcome. [25:01]
• Key Senate races, especially in Texas, are profiled with candidate positions on tariffs, marijuana, and data center regulation. [27:00]
• TJ emphasizes that portfolio management should remain mechanical and unaffected by election results, reiterating the core strategy of selling premium. [30:02]
• A detailed breakdown of Palantir positions is given, with high delta exposure and expectations for strong earnings driven by government contracts. [35:00]
• Technical analysis of Palantir is performed across multiple timeframes, noting oversold conditions and the importance of zooming out for trend perspective. [39:02]
• He explains the limitations of technical indicators ahead of binary events like earnings, stressing fundamentals over technicals in such moments. [41:00]
• Audience engagement is encouraged regarding Palantir positioning, and the portfolio's buying power is reviewed as volatility increases before earnings. [48:00]
• Options chains and implied volatility are analyzed for Palantir and Apple, with consideration of potential earnings plays and risk management. [56:05]
• A live margin health check is conducted, showing strain in Micron and Palantir positions, and the importance of proactive risk management is reiterated. [1:00:00]
• Palantir's earnings are released, showing beats on revenue and EPS, with commercial revenue surpassing government for the first time and strong year-over-year growth. [1:04:03]
• Palantir's shareholder letter is read, emphasizing the company's rapid growth, shift toward commercial clients, and long-term ambitions in AI and software. [1:14:01]
• TJ expresses confidence in his Palantir strategy post-earnings, reiterates the importance of thesis-driven investing, and closes with reminders to stay disciplined and focused. [1:19:00]

DETAILED ANALYSIS

The episode opens with TJ candidly addressing a challenging trading day, marked by a portfolio drawdown exceeding half a million dollars. Despite the setback, he outlines recent trades, including the purchase of 1,000 shares of ASST and 10,000 shares of Riot, and discusses the implications of potentially being assigned large quantities of stock, which would significantly increase margin requirements. He reassures viewers that, if necessary, he would negotiate margin rates with his broker, Tastytrade, to manage risk.

The portfolio review also covers active management of Palantir (PLTR) positions, with a skewed strangle in a smaller account and a more balanced strangle in the main account, reflecting a bullish stance ahead of earnings. Additional trades include selling calls on Micron (MU), MSTR, and ASST, and closing profitable Palantir calls before selling new ones at higher strikes.

Transitioning to a broader educational segment, TJ introduces a slideshow focused on the intersection of government policy and market sentiment, timed with the U.S. midterm elections. He frames the midterms as a critical event for traders, not just for their political implications but for their direct impact on fiscal policy, taxes, spending, and sector regulation. Through a series of quiz questions, he explores the mechanics of municipal bonds, the effects of legislative risk on investments, and the regressive nature of sales taxes, connecting these concepts to real-world ballot measures and the broader economic environment.

TJ then outlines three potential post-election scenarios: (1) Republicans maintain control, leading to policy continuity but with thin majorities and ongoing legislative risk; (2) Democrats take the House, resulting in gridlock, frequent shutdown brinkmanship, and heightened headline volatility; and (3) Democrats control both chambers, which would still be constrained by a Republican White House and filibuster, but with increased risk of veto standoffs and government shutdowns. He emphasizes that, regardless of the outcome, the primary market effect is the removal of uncertainty, which is typically priced in before most traders can react.

A significant portion of the episode is dedicated to the unique role of data centers in the current election cycle. TJ highlights the surge in power prices attributed to data center demand, with local ballot measures in 13 states and bipartisan support for requiring data centers to bear their own infrastructure costs. He notes that both Democratic and Republican candidates are advocating for moratoriums or cost-sharing, indicating a structural trend rather than a transient election risk.

The discussion connects these policy shifts to investment opportunities in companies like Micron, which supplies memory for AI infrastructure, and Clean Spark, which operates grid-connected power assets. The potential for extended buildout timelines, subsidy rollbacks, and increased capital expenditure risk is acknowledged, particularly for marginal operators.

Providing historical context, TJ references the '19 for 19' midterm effect, where the S&P 500 has risen in the year following every midterm since 1946, with an average gain of 15.1%. He cautions, however, that this year’s market had already rallied into the vote, suggesting some relief may be preemptively priced in. Key Senate races are profiled, with a focus on Texas, where the contest between Ken Paxton and James Talarico is described as a statistical dead heat.

Both candidates share positions on certain issues, such as opposition to specific border wall segments and support for data center regulation, but differ on tariffs, marijuana policy, and economic strategies.

TJ reiterates his core trading philosophy: remain mechanical, methodical, and mathematical, regardless of political events. He stresses that elections are volatility events to be endured, not signals to trade on, and encourages viewers to vote as an expression of civic duty while keeping emotions and politics separate from portfolio management.

The analysis then shifts to a granular review of Palantir positions. TJ details a 'goal post' trade with 140 puts and 400 calls, reflecting high conviction in Palantir’s upcoming earnings. He expects strong year-over-year top-line growth, driven by government contracts, and positions the portfolio with the equivalent of 17,000 deltas.

Technical analysis is performed across daily, weekly, monthly, and yearly charts, noting that Palantir appears oversold on the daily (RSI below 30) but remains below major moving averages, indicating a bearish technical setup. However, TJ cautions that technical indicators lose relevance ahead of binary events like earnings, where fundamentals and actual results dominate price action.

Audience engagement is encouraged, with TJ inviting viewers to share their Palantir strategies and participate in a live poll regarding expectations for the earnings reaction. He reviews the options chain for Palantir, noting a wide expected move and elevated implied volatility, and considers a short-term put sale to capitalize on potential IV crush. Apple’s options are also briefly assessed, but TJ finds the risk/reward less compelling.

A live margin health check reveals some strain in Micron and Palantir positions, with margin utilization in the mid-90% range, underscoring the importance of proactive risk management. As Palantir’s earnings are released, the results show beats on both revenue and EPS, with commercial revenue surpassing government revenue for the first time—a significant milestone. Year-over-year revenue growth is reported at 96%, with EPS up 110%, and the company raises its fiscal year guidance.

The immediate market reaction is positive but muted, reflecting the challenging macro environment where even strong beats are not always rewarded with outsized gains.

TJ reads from Palantir’s shareholder letter, which emphasizes the company’s rapid growth, transformation toward commercial clients, and ambition to dominate the AI and software markets. The letter highlights the acceleration of sales cycles, the unique value proposition of Palantir’s sovereign AI solutions, and the company’s alignment with customer interests over conventional software models. The narrative positions Palantir as a foundational player in the ongoing technological revolution, with a commitment to both commercial and government sectors.

In closing, TJ expresses confidence in his Palantir strategy, viewing the post-earnings confirmation as validation of his thesis. He anticipates similar thesis confirmation for Riot, Clean Spark, and Micron in upcoming reports, and reiterates the importance of managing buying power, emotions, and expectations. The episode ends with a reminder to stay disciplined, vote, and focus on the mechanical execution of proven trading strategies.

LINKS

• Tastytrade referral link for brokerage account signup.
• StreamYard signup link with $10 discount for new users.

KEYWORDS