$TSM Winning Strategy: Trader Robot Yields +3.80% Last Week
Artificial Intelligence (AI) trading robots have been making waves in the financial markets, and "Trend Trader: Popular Stocks (TA&FA)" is no exception. These innovative bots, acting as bot factories, achieved an impressive +3.80% gain while trading TSM (Taiwan Semiconductor Manufacturing Company) over the previous week. Despite the recent bearish signal from the Moving Average Convergence Divergence Histogram (MACD), the AI-powered trading bots seem to have navigated the market successfully. In this article, we will analyze the MACD signal, delve into historical data, and examine the latest earnings report for TSM to gain insights into the stock's potential future trajectory.
Analyzing the Bearish MACD Signal
On July 18, 2023, TSM's MACD Histogram turned negative, indicating a potential bearish trend in the stock's price movement. A negative MACD suggests that the short-term moving average is crossing below the long-term moving average, signaling a shift in momentum towards the downside. To understand the significance of this signal, Tickeron's A.I.dvisor studied 41 instances in the past where the MACD turned negative.
Out of the 41 cases, the stock moved lower in 27 instances, resulting in a 66% probability of a downward move following the bearish MACD crossover. While this may raise concerns among investors, it is essential to consider other factors that might influence TSM's future performance, including the company's fundamentals and overall market conditions.
Earnings Results and Market Capitalization
On July 20, 2023, TSM released its latest earnings report, showing earnings per share (EPS) of $1.14. This figure exceeded the estimated EPS of $1.07, indicating that the company performed better than analysts' expectations. Positive earnings surprises can often lead to short-term price movements as investors respond to the better-than-expected results.
Additionally, it's essential to understand the company's market capitalization, which plays a significant role in determining its overall value in the market. With 15.36 million shares outstanding, TSM's current market capitalization stands at a substantial $467.34 billion. A company's market capitalization reflects its total equity value and is a key metric for investors to consider when evaluating investment opportunities.
The Role of AI Trading Bots
AI-powered trading bots have garnered attention for their ability to swiftly analyze vast amounts of data and execute trades based on predefined algorithms. In the case of "Trend Trader: Popular Stocks (TA&FA)," these bots achieved a remarkable +3.80% gain while trading TSM in the previous week. Despite the bearish MACD signal, the bots' algorithms seem to have identified favorable entry and exit points, leading to positive returns.
Summary
AI trading robots have displayed their potential by generating a +3.80% gain while trading TSM amidst a bearish MACD signal. While the negative MACD suggests a possible downward move, it is essential to consider other factors such as the company's earnings results and overall market capitalization. The recent earnings report showed positive results, beating analyst estimates, and the company's market capitalization remains substantial.
Aroon Indicator for TSM shows an upward move is likely
TSM's Aroon Indicator triggered a bullish signal on October 23, 2024. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 255 similar instances where the Aroon Indicator showed a similar pattern. In of the 255 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 11, 2024. You may want to consider a long position or call options on TSM as a result. In of 89 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
Following a +1 3-day Advance, the price is estimated to grow further. Considering data from situations where TSM advanced for three days, in of 317 cases, the price rose further within the following month. The odds of a continued upward trend are .
Bearish Trend Analysis
The 10-day RSI Indicator for TSM moved out of overbought territory on October 18, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 41 similar instances where the indicator moved out of overbought territory. In of the 41 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In of 68 cases where TSM's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where TSM declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
TSM broke above its upper Bollinger Band on October 17, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 67, placing this stock better than average.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (7.508) is normal, around the industry mean (7.487). P/E Ratio (30.405) is within average values for comparable stocks, (58.779). Projected Growth (PEG Ratio) (1.173) is also within normal values, averaging (2.825). Dividend Yield (0.013) settles around the average of (0.020) among similar stocks. P/S Ratio (11.669) is also within normal values, averaging (43.322).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. TSM’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
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General Information
a manufacturer of integrated circuits, silicon wafers, diodes and related semiconductor components
Industry Semiconductors