TSMC exit from ARM stake drives Arm Holdings stock down 7.98%

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Arm Holdings slides 7.98% to $198.65

Highlights

TSMC fully exited its Arm Holdings stake, selling 1.11 million shares for $231 million following an 8% stock drop.
Arm Holdings’ $249 billion valuation and 130x earnings multiple have drawn attention amid earnings concerns and recent profit-taking.
Despite recent downside volatility and a sharp gap-down, technical indicators remain broadly bullish, with the $190–$202 range expected short-term.

Broad selling pressure persists as TSMC exits amid valuation concerns

On April 29, 2026, TSMC fully divested its stake in Arm Holdings, selling approximately 1.11 million shares at $207.65 per share for total proceeds of $231 million and generating about $174 million in retained earnings. This complete exit followed an 8% drop in Arm Holdings' stock on April 27 due to profit-taking after a significant prior rally, which brought attention to its elevated valuation and upcoming earnings release. As of this period, Arm Holdings' market capitalization was close to $249 billion, with the stock trading around 130 times adjusted earnings, though price action has remained under broader selling pressure.

Gap-down volatility intensifies as mixed signals challenge support

SMA-20, SMA-50, and SMA-200 stand at $170.20, $144.99, and $140.39, respectively, with the Ichimoku Kijun support at $185.25. On the daily timeframe, MACD and ADX indicate underlying buyer strength, while RSI is at 62.92 and CCI at 98.72, showing no overbought condition. Stoch RSI reads as oversold, presenting a mixed momentum picture, while BBP at 17.33 signals overbought conditions. The session featured a significant gap-down from $215.88 to an open of $198.49, with price action hovering near the intraday low of $195.15 and volatility remaining high.

Sideways bias holds as recovery hinges on breakout from trading band

In the short term, ARM is expected to trade within a $190 to $202 band, reflecting current volatility. There is an 80% probability of a price increase, while downside risk appears less likely. The baseline scenario anticipates sideways movement within this band. An upside break above $202 would signal a potential recovery, whereas a fall below $190 could trigger further declines, although medium-term indicators continue to favor buyers if key support levels hold.

Viktoras Karapetjanc, Traders Union expert, sees strong fundamentals supporting ARM despite recent profit-taking and TSMC’s exit. He views the high valuation as justified by ongoing institutional demand and solid macro trends. The analyst expects price to hold above key supports, with further gains likely if $202 is breached. "ARM remains structurally resilient, and I see this volatility as a healthy reset before the next upward phase."

Earlier, analysts noted that Arm Holdings was exhibiting strong bullish momentum despite volatility and valuation concerns stemming from profit-taking activity. With TSMC's full exit marking a significant shift in shareholder dynamics, investors should now monitor for a potential upside breakout above $202 as an early indicator of renewed positive momentum.

Source of Data: ARM Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.