NVIDIA's earnings report sparks TSMC's rally; how long can this "AI rebound show" last?

Revisiting the Wang Hui Phenomenon: Can “Old Huang” Save the Market This Time?

Following the news that NVIDIA’s after-hours stock price surged over 6%, TSMC’s ADR also rose accordingly, and the Taiwan stock market opened today with great momentum. TSMC reached 1460 NT dollars in early trading, nearly a 4.7% increase, leading the market rebound. Investors are even excitedly shouting, “Old Huang alone is saving the whole village.”

This rapid rise of TSMC is directly driven by NVIDIA’s better-than-expected quarterly financial report. Analysts pointed out that NVIDIA’s quarterly results indeed boosted market confidence, sparking a reevaluation of the AI industry in the short term. However, it is worth noting that TSMC previously experienced continuous foreign capital adjustments, causing its stock price to dip below the 1465 NT dollar monthly support line, and the chip distribution remains relatively dispersed.

Can TSMC Hold Steady? The Key Depends on NVIDIA’s “Relay”

Industry insiders analyze that the sustainability of TSMC’s rebound will depend on NVIDIA’s subsequent stock performance. If NVIDIA’s gains are only a one-day reaction to the earnings report, TSMC’s upward momentum will be limited; conversely, if NVIDIA continues to hit new highs, TSMC will have a real chance to stabilize above the monthly support line and challenge the resistance zone above 1460 NT dollars.

For long-term investors optimistic about the AI industry and confident in TSMC’s fundamentals, the current price near the monthly line may be an opportunity to consider phased deployment strategies. However, the overall trend is unlikely to be overly aggressive, more likely showing a “gentle and gradual rise” pattern, with foreign capital movements still being a key variable influencing the market.

US Stocks Are Volatile; Following the Trend in Taiwan Has Risks

Although NVIDIA’s earnings report helped the Nasdaq and S&P 500 indices end four consecutive days of decline, market doubts about the Federal Reserve’s December rate decision remain. According to the latest meeting minutes, several officials believe there is no need for further rate cuts in December. Coupled with uncertain employment data outlooks, market expectations for future easing policies have significantly cooled.

From a technical perspective, the S&P 500, after breaking below the 6800-point support, is currently in a high-level oscillation phase. If it cannot regain and hold above 6800 points in the short term, there is a risk of further decline to around 6400 points. In this context, investors need to remain cautious amid US stock market volatility.

Phased Deployment or Waiting and Seeing? Investors’ Dilemma

Overall, NVIDIA’s earnings report has indeed injected momentum into TSMC and brought AI concept stocks back into market focus. However, considering that foreign capital has not yet fully replenished and the US market environment still contains uncertainties, replicating TSMC’s past strong rally is more challenging.

Investors are advised to take advantage of market volatility by adopting phased entry strategies, while closely monitoring foreign capital movements and NVIDIA’s subsequent performance. Only when these signals are confirmed to be stable can investors confidently position themselves for the long-term AI trend.