TSMC's 2.65% Plunge on $3.18 Billion Volume Ranks 21st as Analysts Scrutinize Mysterious Sell-Off

Taiwan Semiconductor Manufacturing Co. (TSMC) saw its stock close down 2.65% on August 1, 2025, with a trading volume of $3.18 billion, ranking 21st in market activity. The sharp intraday decline, despite no major fundamental announcements, sparked analysis into technical and order-flow dynamics.

Technical indicators showed no reversal patterns such as head-and-shoulders or double tops. The RSI and MACD also failed to signal overbought or bearish crossover conditions. Similarly, the KDJ oscillator remained neutral, indicating the move was not driven by momentum-based triggers. Order-flow data, including block trades or liquidity clusters, was unavailable, complicating identification of the decline’s root cause.

Peer stocks in the semiconductor and broader tech sectors exhibited mixed performance. While names like Apple (AAP) and Applied Materials (AMAT) fell between 1.14% and 3.31%, Blackstone (BH.A) declined only 0.98%. This divergence suggests the drop was not sector-wide but tied to thematic or sentiment-driven shifts. Analysts speculated factors such as macroeconomic concerns—rising interest rates or slowing tech demand—could have prompted a rotation out of high-growth stocks like TSMC.

Historical backtesting of TSMC and its peers revealed that intraday drops without clear technical signals often precede short-term corrections. Monitoring RSI and MACD for divergence and key support levels is critical for identifying potential reversals. A high-volume trading strategy, focusing on the top 500 stocks by daily liquidity, returned 166.71% from 2022 to present, outperforming the benchmark by 137.53%. This underscores the role of liquidity concentration in driving short-term price movements, particularly in volatile markets.