Public trading strategy
TSMC and ASML kick off chip earnings season — ride the pre-report momentum
Thesis
The biggest companies driving the AI revolution rely on specialized chips, and the firms making those chips are reporting their financial scores this week. If these chipmakers announce strong sales, it signals that the massive spending on AI infrastructure isn't slowing down. Investors often buy the stock of key suppliers right before these announcements, hoping to catch a wave of optimism and positive guidance.
Strategy approach
Build an event-driven swing strategy on the D1 timeframe that enters long TSM 5 trading days before their scheduled earnings announcement. Exit the position either the day after the earnings release or if the stock drops 5% from the entry price, whichever comes first.