TSM is slightly overextended near-term; potential upside to $530.49 conditional on consolidation in a bullish flag pattern.

Part of this has moved to the next company, because Elon Musk announced today that he is in discussions with Taiwan Semiconductor to either be a buyer of their chips in Texas or to have a partnership stake to help influence the type of chips, so that they become more specialized for the TerraFab project with SpaceX and Tesla.

Now, what else do we have on this chart, guys? I have already drawn it, so it is easy for you to see the summary and notice that we have an "inverted head and shoulders" pattern on the "Taiwan Semi" as well, which has a specific standard target .

What a coincidence, folks, at the top of this parallel channel.

There's a reason why technical analysis goes smoothly, and do you know what it is? It is gratifying for me to see these things. When these measured movements are found , they take the price either to the bottom of the parallel channel or to a major support level like the one we were looking at in the "GIS", or in this scenario, a breakout that takes the price to the top of the parallel channel.

Man, how simple can it be, right ? We know that trading isn't that easy, but when you find patterns like these, mate, they make everything much simpler when trying to read charts.

Now, TSM's near-term stock is slightly overextended at the 75.65 level on the daily Relative Strength Index.

Sorry, I can see a scenario where we might go higher for another day, but we'll start to stabilize later to build momentum before we take the next step towards the 530 level.

A place where we can stabilize a little bit is the previous all-time high of 479, down to the 50% area of this parallel channel at $471.

If the bulls can see the Taiwan Semi consolidate in a clear bullish flag pattern here, there is no reason why it cannot climb to $530.49.

An interesting move, and a strong push on TSM's stock.