Broadcom (AVGO) Plummets 2.7% Amid Volatile Intraday Action: What’s Fueling the Selloff?

Summary
• AVGO trades at $359.56, down 2.71% from its $369.57 close
• Intraday swing spans $358.76 to $374.23, hitting 52W high
• Options chain sees heavy volume in 340–375 strike range
• RSI at 82.13 signals overbought conditions, MACD bullish divergence emerges
Today’s sharp decline in Broadcom, a semiconductor titan, has sparked urgent scrutiny. With the stock trading near its 52-week high yet sinking below key moving averages, the move reflects a tug-of-war between long-term bullish momentum and short-term profit-taking. The options market’s frenzy—particularly in out-of-the-money calls and puts—hints at a pivotal inflection point.

Options Volatility and Profit-Taking Drive AVGO’s Correction
Broadcom’s 2.7% intraday drop stems from a combination of technical exhaustion and aggressive options activity. The stock’s price has surged 60% year-to-date, creating a natural pullback after reaching its 52-week high of $374.23. High-volume options contracts like AVGO20250919C370 (delta 0.333, leverage ratio 83.80%) and AVGO20250919C375 (delta 0.2525, leverage ratio 120.91%) suggest institutional players are hedging against a potential reversal. Meanwhile, the RSI’s 82.13 reading—a clear overbought signal—has triggered algorithmic selling pressure, compounding the decline.

Semiconductor Sector Steadies as Intel (INTC) Holds Ground
Capitalizing on AVGO’s Volatility: ETFs and Options Playbook
• 200-day average: $232.44 (far below current price)
• RSI: 82.13 (overbought)
• MACD: 13.44 (bullish), Signal Line: 7.55
• Bollinger Bands: Price at $359.56 (near upper band of $351.50)
• Key support: $296.73 (30D), $231.14 (200D)

AVGO’s technicals paint a mixed picture: long-term bullish momentum clashes with short-term overbought conditions. The stock is trading above all major moving averages (30D: $306.56, 100D: $262.49) but faces immediate resistance at $374.23. For traders, the 30D support zone ($296.73–$298.35) and 200D support ($231.14–$235.60) are critical. While leveraged ETFs are unavailable, the options market offers high-leverage plays.

Top Options Picks:
• AVGO20250919C370
- Code: AVGO20250919C370
- Type: Call
- Strike: $370
- Expiration: 2025-09-19
- IV: 35.60% (moderate)
- Leverage Ratio: 83.80% (high)
- Delta: 0.333 (moderate)
- Theta: -0.843975 (high time decay)
- Gamma: 0.018045 (high sensitivity)
- Turnover: $2.39M (liquid)
- Payoff (5% downside): $19.53 (max(0, 341.58 - 370) = 0)
- Why it stands out: High leverage and gamma make it ideal for a short-term rebound trade if AVGO breaks above $370.

• AVGO20250919C375
- Code: AVGO20250919C375
- Type: Call
- Strike: $375
- Expiration: 2025-09-19
- IV: 35.83% (moderate)
- Leverage Ratio: 120.91% (very high)
- Delta: 0.2525 (moderate)
- Theta: -0.692314 (high time decay)
- Gamma: 0.015758 (high sensitivity)
- Turnover: $1.14M (liquid)
- Payoff (5% downside): $14.53 (max(0, 341.58 - 375) = 0)
- Why it stands out: Aggressive bulls should target this contract if AVGO surges past $375, leveraging its 120%+ leverage ratio for exponential gains.

Hook: Aggressive bulls may consider AVGO20250919C370 into a bounce above $370.

Backtest Broadcom Stock Performance
Here is the completed event-driven back-test you requested:Key insights (summary):• Only three ≥ -3 % daily plunges occurred for AVGO between 2022-01-01 and 2025-09-11. • Average cumulative return after these events peaked at ≈ +10 % by day 5, then faded; by day 30 the edge disappeared. • Win-rate stayed 100 % through day 11, fell to 33 % by day 20, indicating short-lived momentum. Assumptions & auto-selections:1. “Intraday plunge” approximated as a ≥ -3 % close-to-close drop (minute data unavailable). 2. Default holding-window for the event study set to 30 trading days, a common short-term horizon. Feel free to inspect the interactive panel above and let me know if you’d like deeper drill-downs or different thresholds.

AVGO at Crossroads: Watch $370 Breakout or $296.73 Support
Broadcom’s 2.7% decline has created a pivotal juncture for both bulls and bears. While the stock remains above its 200-day average and MACD remains bullish, the overbought RSI and heavy options activity signal caution. Immediate resistance at $374.23 and support at $296.73 will dictate near-term direction. Sector leader Intel (INTC) is down 0.4%, offering a barometer for broader semiconductor sentiment. Investors should monitor the 30D support zone ($296.73–$298.35) and watch for a decisive breakout above $370 to reinvigorate the long-term uptrend. Action: Position for a rebound with AVGO20250919C370 if $370 holds; exit on a close below $358.76.