Technical Setup: TAIWAN SEMICONDUCTOR-SP ADR Appears Poised for a Breakout.

Our stockscreener has identified a possible breakout setup on TAIWAN SEMICONDUCTOR-SP ADR (NYSE:TSM). This occurs when the stock consolidates following a significant upward movement. While the breakout outcome cannot be guaranteed, it may be worth monitoring NYSE:TSM for potential opportunities.

Technical analysis of NYSE:TSM

ChartMill employs a sophisticated system to assign a Technical Rating to every stock in its analysis. This rating, which ranges from 0 to 10, is determined by carefully assessing multiple technical indicators and properties.

Overall TSM gets a technical rating of 10 out of 10. This is due to a consistent performance in both the short and longer term time frames. Also compared to the overall market, TSM is showing a nice and steady performance.

• Both the short term and long term trends are positive. This is a very positive sign.
• Looking at the yearly performance, TSM did better than 93% of all other stocks. On top of that, TSM also shows a nice and consistent pattern of rising prices.
• TSM is one of the better performing stocks in the Semiconductors & Semiconductor Equipment industry, it outperforms 89% of 108 stocks in the same industry.
• TSM is currently trading in the upper part of its 52 week range. The S&P500 Index is also trading in the upper part of its 52 week range, so TSM is performing more or less in line with the market.
• TSM is currently showing a bull flag pattern! A bull flag pattern occurs when prices pull back slightly after a strong rise up. This may be a nice opportunity for an entry.

Our latest full technical report of TSM contains the most current technical analsysis.

How do we evaluate the setup for NYSE:TSM?

Alongside the Technical Rating, ChartMill assigns a Setup Rating to evaluate the consolidation level of a stock. This rating, ranging from 0 to 10, is updated daily and considers various short-term technical indicators. The current setup rating for NYSE:TSM is 8:

TSM has an excellent technical rating and also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a support zone below the current price at 195.46, a Stop Loss order could be placed below this zone. Another positive sign is the recent Pocket Pivot signal.

Trading breakout setups.

One strategy to consider is waiting for the actual breakout to occur, where the stock breaks out above the current consolidation zone. Traders can then enter a buy position, anticipating further upward momentum. As a risk management measure, it is advisable to set a stop loss order below the consolidation zone.

Disclaimer: This article is not intended to provide trading advice. It is crucial to conduct your own analysis and consider your own observations and trading style when making investment decisions. The article solely presents technical observations and should not be relied upon as a sole basis for trading.

Every day, new breakout setups can be found on ChartMill in our Breakout screener.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.