Download daily PDF
Latest workspace
Dated end-of-day edition
JW Intelligence Report

Taiwan Semiconductor Manufacturing Co Ltd / TSM

StockTechnologySemiconductors
JW Rank70.7/ 100
Official close$425.61-1.69 (-0.40%)
Bid$425.50
Ask$425.73
Previous close$427.30
ATR (14)3.00%
RSI (14)55.2
Volume8.68M
Model reference$420.00
Upside scenario$455.00
Risk reference$405.00
Decision summary

TSM Option Market Prices in Strong Demand for AI Chips

ConstructiveHigh confidence

The TSM option market is pricing in continued strong demand for AI chips, driven by recent positive news from Nvidia and TSMC's role as the exclusive foundry for advanced nodes. The term structure shows backwardation with higher implied volatility at shorter expirations, suggesting a belief that near-term catalysts will drive price movement.

Wheel contextThe market is pricing in a bullish outlook for TSM, driven by strong demand for AI chips. The term structure suggests that investors expect near-term price movement.
Dated supporting context

JW AI outlook

Bullish

Short-term scenario

Cautious buy/add on pullbacks amid Nvidia-driven momentum; 1-3 week upside possible but high uncertainty from profit-taking, sector rotation, or any AI demand wobble. Not a chase at highs.

Three-month outlook

Constructive bias toward $470-500+ if Q3 execution, AI capex, and 2nm/3nm ramps stay on track with continued Nvidia/cloud demand; expansions and customer wins (Xiaomi etc.) supportive. However, elevated uncertainty from Taiwan-China geopolitics (any headline risk), premium valuation (~30x trailing leaving little room for misses), potential margin dilution on new nodes/overseas fabs, broader tech/semiconductor volatility, and whether AI spending remains 'red-hot' through 2026. Monitor Nvidia follow-through and monthly sales closely.

Market sentiment context

Predominantly bullish among investors citing TSMC's unmatched AI/HPC foundry moat, 60%+ margins, 30%+ growth, pricing power, and role as 'toll road' for Nvidia/Apple/AMD/cloud. Posts highlight buying on pullbacks (e.g., at $408), PEG

Observed market data

Price and technical structure

Dated end-of-day indicator set
Trend reference levels11 observations
20D SMA$418.51
50D SMA$423.72
200D SMA$368.92
9D EMA$419.28
21D EMA$418.28
20D MVWAP$418.29
YTD VWAP$382.90
Daily reference VWAP$425.82
Price vs 20D SMA2.10%
Price vs 50D SMA0.84%
Price vs 200D SMA15.82%
Momentum kinematics10 observations
RSI (7)62.08
RSI (14)55.19
RSI (21)53.10
Stochastic K50.66
Stochastic D38.20
MACD line0.58
MACD histogram-0.03
ADX (14)9.22
MACD acceleration0.30
RSI velocity3.13
Volatility and price boundaries11 observations
ATR (14)-0.29
ATR (14) %3.00%
Bollinger upper$433.67
Bollinger middle$418.51
Bollinger lower$403.36
Bollinger position0.79%
Volatility environmentMedium
20D realized volatility24.45%
Observed range position51.15%
5D true high$429.64
5D true low$405.15
Participation and institutional flow7 observations
Volume8.68M
20D average volume6.11M
Volume vs 20D average1.42x
20D SMA velocity1.54
50D SMA velocity-0.19
Institutional flow2.66
ATR velocity-0.29
Available cached indicators

Detailed decision indicators

Dated authorized values
Market overview7 observations
Price$425.61
DateAug 27, 2026
Volume8.67M
Vwap D$425.82
Mvwap 20$418.29
Change-1.69
Change Percentage 0.4%
Trend structure6 observations
Trend SignalStrong Bull
Sma 20$418.51
Sma 50$423.72
Sma 200$368.92
Ema 9$419.28
Ema 21$418.28
Momentum structure9 observations
Rsi 762.08
Rsi 1455.19
Rsi 2153.10
Rsi SignalNeutral
Stoch K50.66
Stoch D38.20
Macd Line0.58
Macd SignalBearish
Macd Hist-0.03
Volatility structure3 observations
Atr12.81
Atr Pct3.00%
EnvironmentMedium
Option market context3 observations
Current Iv31.85
Iv Rank10.56
Iv Percentile3.59%
Price boundaries8 observations
Bb Upper433.7
Bb Middle418.5
Bb Lower403.4
Bb Pctb0.79
True High$429.64
True Low$417.69
True High 5d$429.64
True Low 5d$405.15
Three-day velocities7 observations
Sma20$1.54
Sma50$-0.19
Mvwap20$2.66
Macd0.30
Rsi3.13
Volume687,198
Atr-0.29
Risk radar5 observations
Earnings RiskLow
Earnings DateOct 15, 2026
Macro RiskUnknown
Vol RiskMedium
Structure RiskLow
Deterministic scoring

JW Rank factors

Higher scores indicate stronger observed structure
LiquidityTrading capacity and quote quality proxyCoverage 100%
97
Strategy FitGeneric Wheel premium-selling environment fitCoverage 100%
69
Technical TrendPrice trend, momentum and long-term structureCoverage 100%
79
Market Tail RiskMarket-wide volatility and tail-risk regimeCoverage 100%
56
Fundamental QualityBusiness quality and balance-sheet durabilityCoverage 100%
93
Volatility PressureOption premium pressure relative to realized movementCoverage 100%
39

JW Rank is not a buy/sell rating, and coverage measures field availability—not accuracy or certainty.

Options Intelligence

What the closing chain was pricing

TSM Option Market Prices in Strong Demand for AI Chips

The TSM option market is pricing in continued strong demand for AI chips, driven by recent positive news from Nvidia and TSMC's role as the exclusive foundry for advanced nodes. The term structure shows backwardation with higher implied volatility at shorter expirations, suggesting a belief that near-term catalysts will drive price movement.

Front ATM IV40.52%
Current IV31.95%
IV Rank10.93
IV Percentile4.38%
25Δ skew-0.54
Term slope-8.85
Term structureBackwardation
Quote coverage100%
Median option spread7.14%
Term structure

Implied volatility by expiration

3 observed expirations
40.5%31.7%
ExpirationDTEATM IVState
2026-08-281.0040.52%—
2026-09-048.0032.93%—
2026-09-1115.0031.67%—
Reference structures

Defined-risk observations

Bull Put Spread Reference

Expiration—
Short strike$420.00
Long strike$417.50
Net credit / share$0.60
Credit / width23.80%
$60$-190$416.13$421.38Expiration payoff per standard 100-share contract

Bear Call Spread Reference

Expiration—
Short strike$432.50
Long strike$435.00
Net credit / share$0.45
Credit / width18.00%
$45$-205$431.13$436.38Expiration payoff per standard 100-share contract
Evidence used
  • TSM rallied ~2.3% on Aug 27 after Nvidia posted record $96.2B revenue and $108B Q3 guidance, confirming strong AI chip demand as TSMC is the exclusive advanced-node foundry.
  • July revenue hit record NT$467.58B.
  • Q2 beat with raised 2026 capex to $60-64B and extra $100B Arizona investment.
Risk context
  • Elevated uncertainty from Taiwan-China geopolitics (any headline risk)
  • Premium valuation (~30x trailing leaving little room for misses)
Strategy intelligence

Structural fit, not a trade instruction

Wheel fit score68.80

The market is pricing in a bullish outlook for TSM, driven by strong demand for AI chips. The term structure suggests that investors expect near-term price movement.

Execution intelligence

Liquidity and quote conditions

Dollar volume$3.71B
Underlying bid/ask spread0.09%
Option quote coverage100%
Median option spread7.14%
Fundamental intelligence

Business quality context

Factor score93.10
Coverage100%

Business quality and balance-sheet durability

Latest strategy observation

TSM Covered Call signal

Aug 27, 2026 9:33 AM EDT

Covered Call | 2026-08-28 | short $422.50 | $5.70 credit | High turnover | also meets Conservative

Generalized structural observation only; no quantity, order instruction or personalized recommendation is provided.

Company and fundamental profile

Taiwan Semiconductor Manufacturing Co Ltd at a glance

Dated valuation, quality, growth and shareholder context

Market position and valuation

Market capitalization$62.63T
P/E (TTM)27.9×
Beta0.99
52-week range$1,135.00 – $2,535.00
52-week return17.52%
Shares outstanding25.93B

Profitability and financial quality

Return on equity39.86%
Operating margin56.38%
Net margin50.70%
Debt / equity0.20×

Growth and cash generation

Revenue growth (3Y)18.94%
EPS growth (3Y)19.11%
Free cash flow CAGR (5Y)26.54%
Revenue / share (TTM)172.3
Book value / share248.0

Shareholder return and calendar

Dividend yield1.99%

Trading and reference facts

MarketTaiwan Stock Exchange
CountryTw
CurrencyTwd
IPO date1994-09-05
Company website
Methodology, edition and field coverage
EditionOfficial Close
Ready sections3 / 3
Report identity55c153939cb436136801c3cb

JW Rank is deterministic and is not a buy/sell rating. Narrative sections explain dated evidence and do not change the score or observed facts. Coverage measures field availability, not accuracy or certainty. This public edition remains fixed.

Continue with the same symbol

Carry TSM from this dated report into your Watchlist.

The report remains a fixed publication. The App and web workspace continue with current cached quotes, alerts, options context and symbol history.

Sign in to follow TSMCompare plans
Important disclosures. Generalized market-structure research only. This report does not consider holdings, objectives, risk tolerance or financial circumstances and is not an investment recommendation, transaction instruction, offer, solicitation or return forecast. Market data, model scores and AI explanations may be delayed, incomplete or incorrect. Past, hypothetical, model and settled-signal results do not predict future results. Options are complex and may involve loss of the entire premium, substantial or theoretically unlimited loss, assignment, early exercise, margin, liquidity and execution risk. Before trading standardized options, read the OCC’s Characteristics and Risks of Standardized Options. Terms of Use · Privacy Policy