Taiwan Semiconductor Manufacturing Co. is doing what bulls have been looking for: holding near record territory even as fears of an AI-fueled tech pullback linger around the sector. The stock closed at NT$426.35, just above its 50-day moving average and close to the upper end of its recent trading range, while Nvidia and the wider chip complex also stayed firm, suggesting investors still see AI spending as durable rather than cyclical froth.
TSMC Holds Near Record as AI Chip Demand Stays Firm
That matters because TSMC sits at the center of the global semiconductor supply chain. If demand were truly rolling over, the first place investors would expect it to show up would be at the foundry that makes the most advanced chips for Nvidia, Apple and other major technology customers. Instead, TSMC’s share price has climbed sharply from NT$374.67 on July 29, and the stock remains well above its 200-day moving average, a sign that institutional money is still willing to pay for exposure to AI infrastructure and high-end chip manufacturing.
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The broader market backdrop reinforces that view. The SOXX semiconductor ETF closed at 550.42, recovering from its late-July selloff, while Nvidia finished at $225.16 and remains far above its long-term trend line. In technical terms, TSMC’s RSI in the mid-60s and positive MACD reading point to momentum that is still constructive, though not without signs of near-term overheating after the recent rebound. For investors, that combination usually means the market is buying the dip in semiconductors rather than abandoning the AI trade.
The stock action also lands against a supportive fundamental backdrop. New industry data continue to point to strong AI-related chip demand, with Asian semiconductor supply chains still drawing capital and customer orders. TSMC’s latest filing underscored its scale, noting 305 process technologies and 12,682 products for 534 customers in 2025, while the company also approved a new joint venture with Sony Semiconductor Solutions for next-generation image sensors. That suggests TSMC is not just riding the AI wave through Nvidia-linked logic chips, but also broadening its industrial and consumer exposure.
The bull case is that AI capital spending remains early in its cycle and that TSMC, as the dominant contract manufacturer for advanced nodes, retains pricing power and volume growth. The bear case is that valuations across the chip sector already price in a lot of that optimism, leaving semiconductors vulnerable if hyperscalers slow spending or if investors rotate out of crowded megacap tech positions. For now, though, TSMC’s resilience is the cleaner read: the market is treating recent volatility as a correction, not the start of an AI unwind.
What investors should watch next is whether TSMC can keep trading above its 50-day average while the SOXX and Nvidia confirm the rebound. If they do, the current move will look less like a relief rally and more like evidence that the AI supply chain still has room to run. If they fail, the selloff fears will return quickly.
| Entity | Gains | Losses |
|---|---|---|
| TSMC | ▲AI demand premium | ▼Selloff skeptics |
| Nvidia | ▲Chip demand support | ▼Short-term bears |
| SOXX holders | ▲Sector rebound | ▼Momentum shorts |
| Tech customers | ▲Supply-chain stability | ▼Buyers fearing overcapacity |
