I went short today based primarily on the chart and overal weakness in this sector. Support has been broken, volume on the sell side has increased and the stochastics are dismal. I plan to cover at $10. Sell now and make some money on the way down.
Who knows....perhaps after the bottom is reached and the stock shows a compelling technical reversal, I may go long. I just like to make money, I'm not a wholesale doomsdayer.
Incidently, I think the exchanges are better with people who have an opposing view. They force you to re-assess your position, making you reflect on whether the principles and conditions still exist that got you into your position in the first place.
Good Exchange. Nice to chat about something other than poor grammar and Asian politics.
I admit to a long position on this issue. I am very bullish on this company and their long term prospects. I also think the rest of the investment world will wake up to this powerhouse in the near future (that's 12-24 months for us Longs). When you consider that TSM revenues may reach $5B this year and factor up for the retail IC revenue value this would make TSM close to a $15B slice of the chip market and in some pretty rarified company. I think once the market truly recognizes the overall influence TSM has in the tech world, the Shorts may be sorry they didn't stick around for the party.
In fact youre right, I DO think it will get back to where the price is now sometime during the summer. I expect a summer rally that will sell off in the fall. However, I'd rather buy at a price at a 30% discount to today's price than at a 10% discount based on the dividend.
Who knows, perhaps we'll both be fine if TSM is at $10 on June 19th and we find out that's bottom. However, most of the market charts actually suggest that the Sept 11th lows may not even provide support for this market's bottom.
"However, the market may be ripe for a rally against the primary trend soon. " ---------------------------------------
Like I said, only insincere rallies right now against the primary trend which is falling down off a cliff. I'm not sure where your "ripeness" is supposed to come from (most likely wishful thinking "it can't get worse than this right?". The overdone fruit looks more bearish than not. You will not see TSM significantly penetrate $15 until the whole market reverses. Go short for now and make a little dough. I am certain we will see $12.50 soon enough and I am planning to cover my short position right now at $10. We'll see.
Today's clue...."look at the pitiful volume in the black today even at these "distressed" prices." Notice that TSM can't seem to penetrate $14.65 regardless of how high the NASD or DOW rises.
I think any attempt at a rally will be insincere based on the market tentativeness. Look for a more significant rally this summer im my opinion. This chart is quite textbook in formation. I rarely short a stock before it breaks support, and when it does, I rarely lose money. It will take something monumentous to restrict this chart from taking its expected conclusion; which is a significant retrace to the 10-12.5 levels. I also thiunk the semi market is perhaps more overvalued than tech as a whole. We'll see. Good luck.