Start with the trend, because if the trend is wrong, nothing else matters. TSM has been climbing for the better part of a year in a steady staircase, higher highs and higher lows, and it is sitting right up near its highs around $432. Anyone can look at that chart above and tell you that it’s trending upward. You don’t have to be a chart whiz to identify the trend. Then the pattern, and this is where I lean in. Look at the moving averages. The 8-day EMA sits on top, the 21-day right beneath it, the 34-day beneath that, all of them rising, with price riding above the whole stack. And it is doing this on both the daily and the weekly chart. Here is why that matters. When the averages line up in that order, the trader who bought last week, the one who bought last month, and the one who bought months ago are all sitting in the green together. Nobody is trapped overhead waiting to dump shares into the first sign of strength. When two timeframes point the same direction like that, it is far stronger than one, and right now the buyers clearly own this thing. Last is the squeeze, which is what got me to write this up. A squeeze occurs when a stock stops making big moves and cools into a tighter and tighter range. Picture a spring being slowly compressed. The volatility winds down, the range pinches in, and all that energy gets stored with nowhere to go yet. The longer it coils, the harder it tends to pop when it finally releases. On TSM, that squeeze is on right now. Here is what makes this one especially interesting. The spring is coiling up near the highs, not down in the gutter after a beating, which is the most bullish place it can be. And it is winding up right ahead of the company's next earnings report on July 15. A stock that is already trending hard, stacked on two timeframes, and tightening into a known catalyst is exactly the kind of chart I go hunting for. Trend, pattern, and squeeze, all lined up on the same name, with a catalyst on the calendar. That is the whole package. Your Action Plan I would not be surprised to see TSM run hard into its July earnings. Now, if you want to see what trading on the faster end of the spectrum looks like, there is a new initiative worth a look. I’ve been showing regular folks how to target fast, defined moves, with example wins like $10,000 in 6 minutes, $20,650 in 12 minutes, and $21,700 in 11 minutes, and never once by betting on a falling stock. The next one is coming between now and Monday. Get access to the next Fast Cash trade here. |
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