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A Closer Look at Taiwan Semiconductor's Options Market Dynamics
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A Closer Look at Taiwan Semiconductor's Options Market Dynamics
Apr 30, 2024 7:42 AM

Investors with a lot of money to spend have taken a bullish stance on Taiwan Semiconductor .

And retail traders should know.

We noticed this today when the trades showed up on publicly available options history that we track here at Benzinga.

Whether these are institutions or just wealthy individuals, we don't know. But when something this big happens with TSM, it often means somebody knows something is about to happen.

So how do we know what these investors just did?

Today, Benzinga's options scanner spotted 14 uncommon options trades for Taiwan Semiconductor.

This isn't normal.

The overall sentiment of these big-money traders is split between 50% bullish and 35%, bearish.

Out of all of the special options we uncovered, 3 are puts, for a total amount of $103,054, and 11 are calls, for a total amount of $548,638.

Expected Price Movements

After evaluating the trading volumes and Open Interest, it's evident that the major market movers are focusing on a price band between $85.0 and $155.0 for Taiwan Semiconductor, spanning the last three months.

Insights into Volume & Open Interest

Assessing the volume and open interest is a strategic step in options trading. These metrics shed light on the liquidity and investor interest in Taiwan Semiconductor's options at specified strike prices. The forthcoming data visualizes the fluctuation in volume and open interest for both calls and puts, linked to Taiwan Semiconductor's substantial trades, within a strike price spectrum from $85.0 to $155.0 over the preceding 30 days.

Taiwan Semiconductor Option Volume And Open Interest Over Last 30 Days

Significant Options Trades Detected:

Symbol PUT/CALL Trade Type Sentiment Exp. Date Ask Bid Price Strike Price Total Trade Price Open Interest Volume
TSM CALL TRADE NEUTRAL 07/19/24 $6.85 $6.7 $6.78 $145.00 $95.5K 2.2K 1
TSM CALL TRADE BULLISH 01/17/25 $11.0 $10.8 $11.0 $155.00 $77.0K 10.5K 0
TSM CALL TRADE NEUTRAL 06/21/24 $7.05 $6.95 $7.0 $140.00 $70.0K 28.8K 112
TSM CALL TRADE BULLISH 03/21/25 $58.85 $58.2 $58.85 $85.00 $58.8K 9 10
TSM CALL SWEEP BEARISH 05/03/24 $0.51 $0.5 $0.5 $145.00 $45.0K 4.7K 1.5K

About Taiwan Semiconductor

Taiwan Semiconductor Manufacturing Co. ( TSM ) is the world's largest dedicated chip foundry, with almost 60% market share. TSMC was founded in 1987 as a joint venture of Philips, the government of Taiwan, and private investors. It went public as an ADR in the U.S. in 1997. TSMC's scale and high-quality technology allow the firm to generate solid operating margins, even in the highly competitive foundry business. Furthermore, the shift to the fabless business model has created tailwinds for TSMC. The foundry leader has an illustrious customer base, including Apple, AMD, and Nvidia, that looks to apply cutting-edge process technologies to its semiconductor designs. TSMC employs more than 73,000 people.

Having examined the options trading patterns of Taiwan Semiconductor, our attention now turns directly to the company. This shift allows us to delve into its present market position and performance

Taiwan Semiconductor's Current Market Status

Currently trading with a volume of 1,510,565, the TSM's price is up by 0.58%, now at $139.3.

RSI readings suggest the stock is currently may be approaching overbought.

Anticipated earnings release is in 79 days.

What The Experts Say On Taiwan Semiconductor

Over the past month, 5 industry analysts have shared their insights on this stock, proposing an average target price of $162.2.

Maintaining their stance, an analyst from Susquehanna continues to hold a Positive rating for Taiwan Semiconductor, targeting a price of $180.

An analyst from Barclays persists with their Overweight rating on Taiwan Semiconductor, maintaining a target price of $150.

An analyst from Barclays persists with their Overweight rating on Taiwan Semiconductor, maintaining a target price of $145.

Maintaining their stance, an analyst from Needham continues to hold a Buy rating for Taiwan Semiconductor, targeting a price of $168.

Reflecting concerns, an analyst from Needham lowers its rating to Buy with a new price target of $168.

Options trading presents higher risks and potential rewards. Astute traders manage these risks by continually educating themselves, adapting their strategies, monitoring multiple indicators, and keeping a close eye on market movements. Stay informed about the latest Taiwan Semiconductor options trades with real-time alerts from Benzinga Pro.

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