AVGO Options Signal $350–$370 Bullish Setup as AI Margins Spark Rotation Risks

• AVGO trades at $340.6, up 0.23% with volume surging to 36.6M shares
• Options data shows heavy call open interest at $350 and $370 strikes for Friday expiration
• RSI at 37.5 suggests oversold conditions, but MACD histogram turns negative

Here’s the thing: Broadcom’s options market is painting a mixed picture. While bulls are stacking up calls at key resistance levels, the technicals hint at a fragile rebound. Let’s break down what this means for traders today.

Bullish Pressure at $350–$370 vs. Deep Put Protection at $300

Looking at this Friday’s options chain, the top OTM calls are clustered between $350 and $370 (OI: 16,103 at $350 and 19,056 at $370). That’s not random—these strikes align with the 30D support/resistance range (339.81–341.27) and the upper Bollinger Band (427). It suggests smart money is hedging a short-term bounce off oversold RSI levels.

But don’t ignore the puts: $300 and $310 strikes have 14,216 and 13,089 open interest respectively. That’s a bearish safety net for a 10% drop from current price. The put/call ratio (0.98) is nearly balanced, but the skew toward higher-strike calls implies some conviction in a rebound. No block trades to worry about—this is retail and small-cap institutional positioning.

AI Margins vs. Analyst Optimism: A Tug-of-War

Broadcom’s recent 16.4% drop has investors split. On one hand, Q4 AI revenue hit $6.5B (up 74% YoY) with major contracts at Google and Meta. Analysts still average a $455 target. On the other hand, margin compression from low-margin AI hardware and customer concentration risks are real.

The market’s reaction? A “wait-and-see” stance. The stock trading below its $403.66 fair value estimate means there’s upside potential—but only if non-AI segments stabilize. The options data reflects this duality: bullish calls for a rebound, bearish puts for downside insurance.

Trade Ideas: Calls at $350, Puts at $310, and Precision Entries

For options traders:

• AVGO20251219C350 (Friday $350 call): Buy if price breaks above $341.27 (30D resistance). Target $370 if the 200D MA (280.67) continues to support the rally.
• AVGO20251219P310 (Friday $310 put): Hedge against a 12% drop. Use this if RSI dips below 30 or volume spikes south.

For stock traders:

• Entry near $338.30 (lower 200D support band) with a stop-loss below $335.06 (intraday low).
• Target zone: $343.63–$347.50 (upper 200D resistance and intraday high).

Volatility on the Horizon: Watch the 30D MA

Broadcom’s in a tight box—long-term ranging but short-term bearish. The 30D MA at $368.69 is a key ceiling. If bulls push through $370, this could signal a shift from consolidation to a new uptrend. But watch for a breakdown below $338.30; that would validate the puts at $310 and force a reevaluation of the AI growth narrative.

Bottom line: This is a stock at a crossroads. The options market is pricing in both a rebound and a retreat. Your move depends on whether you trust the analysts’ $455 target or the margin pressures in the headlines. Either way, $350 and $310 are your guardrails.