 Hey, this is Dan. Let's talk about TSM Taiwan semiconductor Is it a good time to buy or should we sell? In my February 15th video after I performed the fundamental analysis for TSM I came to a conclusion that the price would reach 160 by the end of 2021 at this point. I'm still sticking to my target. However, as you probably know TSM has been under some headwinds lately, especially since March. Why? Because there are two main events affecting the stock price of TSM. Number one is the recent drought in Taiwan and Number two is the recent surge of COVID cases in Taiwan. TSM has more than 90% of their manufacturing facilities on the island of Taiwan That's why these two factors have affected the prices of TSM, even though the actual operations of the company have not been affected because of the various countermeasures put in by the management. Nevertheless, there's still a very strong psychological factor affecting the stock price. If you are interested in what I'm saying so far, please click the like subscribe and notification button Which will encourage me to make similar videos in the future. It is also for the sake of the YouTube algorithm Thank you very much. Let's continue and get into more details Currently Taiwan is experiencing the worst drought in 56 years To make it worse for the world around 90% of the most advanced microchips and manufacture in Taiwan At this point the government of Taiwan has been stopping irrigation of farmland in order to continue to support the industries Especially the semiconductor industries, but the situation is getting tight. The water quality is extremely critical to chip production TSM already has been reusing 86.7% of its water, but apparently that's still not enough and recently The government of Taiwan built a desolidation plan just in the matter of 70 days to produce more fresh water If necessary, they will certainly be building more plants However, it is hopeful that Taiwan will get more rainfall before they have to build more desolidation plants a couple days ago There's some rainfall in Taiwan provided 12.1 million cubic meters of water But the major reservoirs still have very low water levels as you can see 2.6 percent capacity 2.1 1.6 percent and 1.1 percent. So the situation is still very urgent Now the second thing affecting TSM is the recent surge in COVID cases Because of the surge of COVID cases all schools and non-essential public places including entertainment venues have been shut down TSM factories, however are still open Let's look at the number of COVID cases in Taiwan as you can see When the rest of the world was suffering from outbreak of COVID Taiwan was pretty much protected because of very restrictive quarantine procedures But recently the virus seems to have broken through the defense of the island Or maybe the people have been complacent due to the success of the past year in the last couple of weeks They were seeing up to three four hundred new cases a day. Let's put that in the perspective So May 26th, Taiwan had 397 new COVID cases out of the total population of 23 million people So that's infection rate of 0.0017 percent In comparison in the US on the same day the US had about 23,000 new cases out of 328 million people the infection rate is 0.0072 percent So the infection rate in Taiwan is only about a quarter of the rate of the US And that's why it's not that serious But it's still an increase from their previous history And that's why it's been very alarming and it's been causing the Taiwan stock market to go down And of course TSM stock is sold both at Taiwan and also in the US And that's why it's really causing the stock price to go down Now as far as the vaccination process in Taiwan That's really lacking because of the near-zero case in the last year I guess the island became complacent and they did not aggressively secure COVID vaccine even if they secured contract They did not try to get the delivery to be in early 2021 and that's why they only administered 325,000 doses and that's only 1.4 percent of the population most of the doses required two injections Compared to the US 289 million doses have been given and that's equivalent to 88 percent of the population Of course in the US most of the vaccines require two doses And that's why the US coverage is about 50 percent of the population Who have received the second dose But Taiwan is really lagging as far as vaccination There's some hope because the health minister of Taiwan recently said that 2 million vaccine doses would arrive by the end of June and 10 million By the end of August Remember the population of the island is 23 million people So if they have 12 million doses at two doses each AstraZeneca these are mainly And that'll cover six million people That's a quarter of the people and that's not nearly enough But it's better than what they have now They've ordered a total of 20 million doses from AstraZeneca and Moderna That'll cover about half of the population In addition Taiwan has been developing their own vaccines And from what I heard they have two different vaccines being developed And they will probably be ready to deploy in July of this year Also as of today the news came out that the ruling party in Japan is urging the Japanese government To start shipping AstraZeneca vaccines to Taiwan as soon as possible I will be monitoring this development very closely Let's look at the charts This is the daily chart for the last year As we can see TSM has gone up 124 percent which is very impressive Although it's come down in the last three months TSM performance is definitely much better than QQQ or SPY which went up by about 40 percent If you're zooming for the last three months TSM had definitely underperformed Compared to the broad market it actually came down by about 10 percent Whereas QQQ went up by 3 percent and SPY went up by almost 8 percent Let's look closer at a daily period for the last six months We can see this downward trending channel Although in the last two three days the price seems to be breaking above the channel In the meanwhile the DMI indicator seems to be just about to turn bullish Whereas MACD already turned bullish yesterday Let's zoom into the four hour chart Again we see this upper boundary of a downward sloping line And there's a breakthrough here in the last couple of days We see the bullish buy signal from DMI and the bullish buy signal for MACD Although the RSI seems to be a little high That means the price is probably due for a little pullback in the next couple of days With the hourly chart we certainly see this upward trend in the last couple of weeks We do see the warning signal from RSI Although after going sideways or drifting down just a little bit Every time hitting the RSI overboard signal Then the price continued to go up after a few hours Hopefully that trend will continue Especially if they get more rain in Taiwan And also if the COVID cases are under control in the next few days Let's look at the support and resistance levels I see support at 114 which is the 20 day simple moving average That'll be a strong support point And I see historical support at 112 and 109 Which is the lower bollinger ban on the daily chart For resistant levels I see 119 Which is the upper bollinger ban on the daily chart That'll be a fairly strong resistance And then the historical resistance of 121, 124 And 128 Again I'd like to repeat that I'm staying with my target of $160 by the end of 2021 I still hold TSM shares at this point Although I did sell some shares After the price peak around late February If you want to see my detail fundamental analysis of TSM Please refer to my February 15 video The link for that video is provided below this video As far as my strategies I will be buying small batches of TSM in the next few days As the price continues to climb up I'll be nibbling Because I'm still bullish about TSM long term And I think at this point The COVID situation is starting to be under control As far as the drought Let's just hope that Taiwan get more rain And I will definitely continue to monitor The support and resistance levels And definitely once the COVID cases are under control And that there's more rain in Taiwan The TSM price will certainly shoot up Thank you for watching all the way to here At this point I'd like to encourage you to subscribe To my Twitter account Which is Dan Market Space L Because I will be entering any text updates To my YouTube videos In my Twitter account You can also post any comments Questions or suggestions To my Twitter account And I'd like to remind you that I'm not a financial advisor I share my stock trading strategies For education purposes only You should make your own decision With regard to buying or selling stocks And you should probably consult with your financial advisors Before you do so This wraps up my video for now I will chat with you again in the next few days In the meanwhile I'd like to wish you the very best of luck With your financial investments