AVGO Options Signal Bullish Bias at $360–$365: How to Play the AI Giant’s Rebound

• Broadcom (AVGO) surges 3% to $356.60, breaking above 30D support and testing Bollinger Bands.
• Options data shows heavy call open interest at $360 and $365 strikes (Friday expiry), while puts cluster at $340 and $300.
• Analysts highlight $73B AI backlog and 74% Q4 AI revenue growth, but valuation risks persist at 73x P/E.

Here’s the takeaway: AVGO’s options market and technicals are screaming for a short-term bullish breakout, but the stock’s lofty valuation and mixed news flow mean you’ll need to balance aggression with caution. Let’s break it down.

Bullish Calls Dominate at $360–$365, Puts Hedge at $300–$340

The options chain tells a clear story: traders are betting on a push above $360. This Friday’s $360 call (AVGO20260102C360) has 9,607 open contracts, and the $365 call (AVGO20260102C365) adds 4,865. That’s not just noise—it’s a crowded short-term target. The $370 call (AVGO20260102C370) at 6,485 OI suggests some are eyeing a 4% move from current levels.

But don’t ignore the puts. The $340 put (AVGO20260102P340) at 8,433 OI and $300 put (AVGO20260102P300) at 7,968 OI show a downside floor is being priced in. If the stock dips below $345, watch for a test of the 200D support at $338.30.

News Flow: AI Growth vs. Valuation Concerns

Broadcom’s fundamentals are a mixed bag. The $73B AI backlog and 74% Q4 growth in AI semiconductors (driven by Google, Meta, and Anthropic) are huge tailwinds. But the 73x P/E and recent downgrade from analysts (citing late-cycle valuations) mean the market is pricing in high expectations.

Institutional buying (like Burr Financial’s 6% Q3 stake increase) supports conviction, but insider sales totaling $239M in 90 days hint at liquidity needs or profit-taking. The key question: Can the stock justify its valuation with sustained AI demand or will China’s chip competition and Apple’s insourcing plans weigh?

Actionable Trade Ideas: Calls for the Breakout, Stock for the Rebound

1. Options Play (Friday Expiry): Buy AVGO20260102C360 calls if the price closes above $360 today. Target $370–$380 by Friday. Alternatively, a bull call spread with AVGO20260102C360 and AVGO20260102C370 could cap risk while capitalizing on the crowded strike.

1. Stock Play: Consider entry near $355 (current price) with a stop-loss at $345. If the stock holds above the 30D support at $341.67, target $365–$370. For a safer bet, wait for a pullback to the Bollinger Middle Band at $362.72 before buying.

1. Next Friday’s Setup: If the rebound holds, AVGO20260109C365 calls (3,340 OI) could be a low-risk play for a 2% move. Avoid the $400 calls (2,506 OI) unless the stock closes above $370 today.

Volatility on the Horizon

The next 72 hours will be critical. A close above $360 would validate the bullish options bets and open the door to $380. But a drop below $345 could trigger a test of the 200D support at $338.30. Your edge? Use the crowded $360–$365 calls as a liquidity magnet—if the stock breaks through, the options could blow out.

Bottom line: AVGO is a high-conviction AI play with a clear path higher—but the valuation risks mean this isn’t a long-term hold for everyone. For active traders, the options market has already priced in a short-term rebound. Now it’s time to see if the stock agrees.