Lu, winner of the 2005 Mercuries Taiwan Masters, posted a second successive six-under-par 66 to lead over former Asian Tour number one Thaworn Wiratchant of Thailand, who traded four birdies and one eagle against two bogeys for 68 at the US$600,000 event.
Asian Tour rookies Kieran Pratt of Australia and Miguel Tabuena of the Philippines were a further shot back after shooting 68 and 71 respectively at the Taiwan Golf and Country Club.
Lu, who won his second Asian Tour tournament on home soil last month, needed only 23 putts in a round of seven birdies against one blemish highlighted by a 16-yard chip in birdie on the par three eighth hole.
"I didn't put a number in mind that I wanted to shoot before my round. I just went out there and did what I needed to do," said Lu, who leads on 12-under-par 132.
The 32-year-old, playing on his home course, said he needs to overcome the turbulent weather to win his third Asian Tour title.
"You need to be very wary of the weather here. I monitor the news on the weather updates before my round and talk to my caddy on our strategy depending on the weather conditions. I think that's the key to having a good score here," said Lu.
Thaworn renewed his fondness for the Mercuries Taiwan Masters, where he won in 2004, sinking a 10 feet eagle putt on the seventh hole for a 137 total.
He was not surprised with Lu's lead. "I'm playing good and concentrating on my own game. Lu has an advantage because this is his home course but I'm going to play my own game and let the results come," said Thaworn, a 12-time Asian Tour winner.
Tabuena, who at the age of 17 is the youngest Asian Tour member, posted a "boring" round of two birdies against one bogey to give himself a chance of making a charge in the next two days.
"It was a very boring round but I'm in good position of playing aggressively. Shooting under-par on this course is a really good effort. I just tried to get the red numbers and it worked for me," said Tabuena, a silver medallist in the 2010 Asian Games.
The halfway cut was set at four-over-par 148 with a total of 57 players making the weekend rounds.