Taiwan Semiconductor Manufacturing Co. Ltd. (TSM) shares climbed more than 1% in Tuesday's premarket session as investors geared up for the chipmaker's quarterly earnings report later this week. Nasdaq futures were up 0.49%, while S&P 500 futures slipped a hair, down 0.03%.

Investors Await Taiwan Semiconductor Earnings

All eyes are on Taiwan Semiconductor's July 16 earnings report, which should give fresh insight into artificial intelligence chip demand and the broader semiconductor market. The stock is also trying to regain momentum after pulling back from its June high.

According to reports, Taiwan Semiconductor is expected to post a fifth consecutive quarter of record earnings on Thursday, fueled by strong demand for AI chips and advanced packaging technologies.

Based on an LSEG SmartEstimate, second-quarter net profit is forecast to jump 59% year over year to 632.6 billion New Taiwan dollars ($19.65 billion). That follows the company's record 36% increase in quarterly revenue reported earlier this week.

Analysts also expect Taiwan Semiconductor to raise its full-year revenue outlook. Investors will be watching for any increase in the company's 2026 capital spending guidance, with some analysts predicting it could rise from the current $52 billion-$56 billion range to about $58 billion.

Technical Levels To Watch

Taiwan Semiconductor remains in a long-term uptrend. The stock has gained 84.4% over the past 12 months and continues to trade well above its 100-day simple moving average of $391.68 and its 200-day simple moving average of $349.02.

But the shares are still 3.2% below the 20-day simple moving average of $441.14, suggesting recent momentum has cooled. The stock is trading just 0.6% above its 50-day simple moving average of $424.51, making that level an important area for buyers to defend.

The relative strength index sits at 45.93, which signals neutral momentum. That means neither buyers nor sellers have a clear advantage right now.

The moving averages still support a bullish long-term trend. The 20-day average remains above the 50-day average, and the 50-day average stays above the 200-day average.

Key resistance is near $450. A move above that level could strengthen bullish momentum. Key support is around $419, close to the intermediate trend area.

Earnings And Analyst Outlook

Taiwan Semiconductor is scheduled to report second-quarter earnings on July 16.

Wall Street expects earnings of $3.77 per share, up from $2.47 a year earlier. Revenue is projected to reach $39.76 billion, compared with $30.07 billion in the prior-year quarter.

The stock trades at about 36.6 times earnings, reflecting its premium valuation.

Analysts remain broadly bullish. The consensus rating is Buy, with an average price forecast of $489.17. Recent analyst actions include:

• Bank of America: Buy; raised price forecast to $590 on June 24.
• Susquehanna: Positive; raised price forecast to $575 on June 22.
• Barclays: Overweight; raised price forecast to $470 on April 22.

MarketDash Edge Rankings

Taiwan Semiconductor scores well across most MarketDash Edge metrics.

The stock carries a Momentum score of 90.7, reflecting strong trend performance. Its Quality score of 97.76 highlights strong fundamentals, while its Growth score of 92.41 underscores continued confidence in AI-driven demand.

Its Value score is 24.1, indicating investors are paying a premium for future growth.

Top ETFs Holding Taiwan Semiconductor

Taiwan Semiconductor is a major holding in several exchange-traded funds, including:

• Harbor International Compounders ETF (OSEA): 7.10%
• iShares International Dividend Active ETF (BIDD): 7.26%
• Pacific NoS Global EM Equity Active ETF (GEME): 9.98%

Large fund flows into or out of these ETFs can influence demand for Taiwan Semiconductor shares.

Price Action

Taiwan Semiconductor shares were up 1.23% at $426.77 during premarket trading on Tuesday, according to market data.