Taiwan Semiconductor Manufacturing Co. (TSM) remains at the forefront of the semiconductor industry, buoyed by growing demand for advanced chips. The stock has reached new heights, fueled by a robust bullish cycle, as observed through Elliott Wave analysis.

Since its 2022 low, TSM’s rally forms a clear three-wave structure: wave I peaked at $226.40, wave II retraced to $134.25, and wave III advanced to new records within a target range of $301.59 to $341.06. This uptrend is projected to continue until late 2025 or early 2026. A wave IV correction might follow, providing an additional purchase opportunity before targeting a Fibonacci extension of $404.

TSM displays a strong pattern on the weekly chart. Analysts perceive pullbacks as buying chances, suggesting precise entry points after corrections. A disciplined approach utilising a proprietary system can enhance confidence in capturing future growth phases.

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With Taiwan Semiconductor Manufacturing Co. (TSM) confirming a powerful bullish cycle, its entry into Wave III presents a clear opportunity. The stock has broken past its old highs and is now targeting the $301.59 to $341.06 zone in the coming weeks and months. We see this advance as fundamentally justified and technically sound.

This move is strongly supported by recent fundamental data. TSM’s Q3 2025 earnings, reported in October, easily beat expectations with a 15% revenue surprise, driven by overwhelming demand for its 2nm chips. Furthermore, the Semiconductor Industry Association’s latest report showed global AI accelerator shipments for October 2025 were up 45% year-over-year, a trend that directly benefits the world’s leading foundry.

The primary strategy for the coming weeks should be to position for further upside, as Wave III is typically the strongest and longest impulse wave. For those looking to leverage this move, buying call options with expirations in late Q1 2026 offers a way to capture the expected ascent toward the $340 level. This timeframe allows the pattern to fully develop without significant time decay pressure.

Given the expectation of a corrective Wave IV pullback after this move, selling cash-secured puts on any meaningful dip is another viable strategy. We observed a similar pattern in the sharp but brief pullback during the summer of 2024, which proved to be a prime entry point. Selling puts with strike prices near recent support levels allows traders to collect premium while setting a favorable entry price for a potential long stock position.

The current elevated implied volatility in short-term options makes selling premium attractive, but longer-dated calls still present good value for capturing the core of this bullish wave. Any minor consolidation or pullback in the next few weeks should be viewed not as a reversal, but as an opportunity to initiate or add to these bullish derivative positions. The path toward the completion of Wave III appears to be the most probable outcome into early 2026.