There is no foolproof update routine from one major release to another.
It is best to do a new install.
Here are some update methods you can try.
Fist method:
Create another boot directory for the vmlinuz and core.gz files.
Create a new tce directory.
Add a bootloader stanza for the new version that specifies the new boot files and the new tce directory.
Using an extension list from your old version, install the same programs in the new version.
Second method:
Backup your boot and tce directories.
Replace the core.gz and vmlinuz files with the new ones.
Reboot
run tce-update