Taiwan Semiconductor Manufacturing Co. (TSM) shares will likely remain in the spotlight ahead of the contract chipmaker’s fourth quarter earnings report due Thursday before the opening bell, with investors expecting 澳洲幸运5官方开奖结果体彩网:artificial intelligence (AI)-driven demand to fuel results.

Analysts expect the Taiwanese chip giant to post a quarterly profit of $11.4 billion, boosted by surging demand for advanced silicon used in AI infrastructure, Reuters reported. Investors will likely have high expectations after the company reported a 澳洲幸运5官方开奖结果体彩网:34% jump in 2024 sales.

The chipmaker’s outlook and 澳洲幸运5官方开奖结果体彩网:capital expenditure (CapEx) will likely come under close scrutiny as the company continues to spend billions on new factories amid the potential for export curbs and tariffs under the incoming Trump administration.

TSMC stock gained 80% in 2024 and traded around 5% higher since the start of the year through Friday’s close. Shares in the company were 3.5% lower in recent trading Monday amid a broader 澳洲幸运5官方开奖结果体彩网:decline in chip stocks.

Below, we break down the 澳洲幸运5官方开奖结果体彩网:technicals on ꦛTSMC’s chart and identify important price levels that investors may be watching out for leading into the chipmaker’s earnings report.

Ascending Triangle Retest

TSMC’s shares broke out from a 11-week 澳洲幸运5官方开奖结果体彩网:ascending triangle earlier this month on above average volume but have since pulled back to retest the pattern’s top ꧂trendline.

Despite the stock’s recent retracement, the 澳洲幸运5官方开奖结果体彩网:relative strength index (RSI) remains ജabove the 50 threshold, i🍒ndicating price momentum still favors the bulls.

Let’s take a closer look at TSMC’s chart to identify a potential bullish 澳洲幸运5官方开奖结果体彩网:price target if the stock moves into price discovery mode and also locate several important 澳洲幸运5官方开奖结果体彩网:support levels worth monitoring during dips.

Bullish Price Target to Watch

To project a price target if the stock breaks out to a fresh 澳洲幸运5官方开奖结果体彩网:record high, investors can apply the measured move technique, also known as the 澳洲幸运5官方开奖结果体彩网:measuring principle.

This works by calculating the distance between the two trendlines of the ascending triangle and adding that amount to the initial breakout point. For instance, we add $40 to $206, which forecasts a target of $246, a level about 18% higher than Friday’s close where investors may decide to 澳洲幸运5官方开奖结果体彩网:lock in profits.

Important Support Levels to Track

Prior to the downtrend on Monday, $206 level could've provided a floor near the ascending triangle’s top trendline.

But now, a move lower could see the shares decline to around $190, a location on the chart where they may attract buying interest near a 澳洲幸运5官方开奖结果体彩网:horizontal line that links the prominent July 澳洲幸运5官方开奖结果体彩网:swing high with several 澳洲幸运5官方开奖结果体彩网:peaks and troughs that formed from August to December.

Finally, a decisive 澳洲幸运5官方开奖结果体彩网:breakdown below that level opens the door for a drop to the $175 level. Buy and hold investors may look to 澳洲幸运5官方开奖结果体彩网:accumulate positions in this region near the August swing high, the October 澳洲幸运5官方开奖结果体彩网:swing low, and the nearby upward sloping 澳洲幸运5官方开奖结果体彩网:200-day moving average.

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