AVGO Options Signal $350–$380 Battle: How to Trade the AI Giant’s Volatility Play

• Broadcom (AVGO) trades at $340.57, up 0.22% but stuck in a long-term range bound by its 30D ($368.69) and 200D ($280.67) moving averages.
• Options market shows a near-even call/put open interest ratio (0.98), but heavy call OI at $350–$410 and put OI at $300–$330 hint at a key price war brewing.
• Recent news highlights AI-driven revenue surges but warns of margin pressures—setting up a tug-of-war between growth optimism and valuation skepticism.

Here’s the takeaway: AVGO is poised for a breakout or breakdown between $350 and $380, with options data and technicals pointing to a volatile week ahead. Let’s break down why this $30 range matters—and how to position for it.

The Options Imbalance: A Bull-Bear Stalemate at Key Strikes

The options market isn’t screaming bullish or bearish—it’s whispering uncertainty. For this Friday’s expirations, the top call open interest (OI) clusters at $350, $370, and $380, while puts dominate at $300, $310, and $330. This suggests two camps:

• Bulls are hedging a potential rebound toward $350+ (current 30D MA at $368.69) with calls at $350–$380.
• Bears are bracing for a drop below $330 (lower end of 200D support at $326.39) with puts at $300–$330.

The near-1.0 put/call OI ratio (0.98) means both sides are equally active. But here’s the twist: the lack of block trades (no large institutional orders) means retail and smaller players are driving this setup. That often leads to choppy, unpredictable moves—especially with AI hype and margin concerns in play.

News vs. Options: Can AI Growth Justify the Hype?

Broadcom’s Q4 results were a mixed bag. It beat earnings, landed $6.5B in AI revenue (up 74% YoY), and secured big contracts with Google and Meta. But the stock fell 17% in three days as investors focused on margin compression from AI hardware costs. Analysts still rate it a Strong Buy, with a $455 price target (33% upside), but the DCF model’s $290.56 fair value raises red flags about overvaluation.

This creates a perception gap:

• Bullish investors see AI as a long-term tailwind, ignoring near-term margin pain.
• Bearish investors question if the stock’s $340+ price reflects unrealistic growth assumptions.

The options data mirrors this divide. Calls at $350–$410 (aligned with analyst targets) and puts at $300–$330 (closer to DCF estimates) show traders are hedging both outcomes. The real risk? A sudden shift in sentiment—either way—could trigger a sharp move.

Actionable Trade Ideas: Calls, Puts, and Precision Entries

Here’s how to play this volatility without overexposing yourself:

1. Bullish Play: Buy AVGO20251219C350 (this Friday’s $350 call) if AVGO breaks above $341.27 (30D support).

• Why: The $350 strike has 16,103 OI and is just below the 30D MA. A breakout here could trigger a rally toward $368.69 (30D) and $376.71 (Bollinger Middle Band).
• Stop: Exit if AVGO fails to hold $339.81 (previous close).

1. Bearish Play: Buy AVGO20251219P310 (this Friday’s $310 put) if AVGO drops below $335.06 (intraday low).

• Why: The $310 strike has 13,089 OI and aligns with the lower end of the 200D support zone ($326.39–$343.63). A breakdown here could test $300 (lower Bollinger Band at $326.39 is already in play).
• Stop: Close the trade if AVGO rebounds above $343.63.

1. Stock Entry Strategy:

• Buy AVGO near $339.81–$341.27 (support/resistance zone) with a target of $368.69 (30D MA).
• Short AVGO near $343.63 (upper 200D resistance) with a target of $326.39 (lower Bollinger Band).

Volatility on the Horizon: The Week That Could Define AVGO’s AI Narrative

The next seven days will test whether AVGO’s AI-driven optimism can outlast margin concerns. With options expiring on Dec 19 and 26, the $350–$380 range is a psychological battleground. If bulls win, the stock could reclaim its 30D MA and test $376.71 (Bollinger Middle Band). If bears take control, a drop toward $300–$326.40 could force a reevaluation of its AI premium.

Bottom line: This isn’t a high-conviction trade—it’s a high-reward volatility play. Stay nimble, watch the $341.27 support and $343.63 resistance levels, and don’t let emotion override your stops. The AI story isn’t over, but the market’s patience is thin. Position accordingly.