AVGO Options Signal Bullish Momentum: Calls at $420–$430 vs. Puts at $300–$310 – Trade Setup for AI-Driven Earnings Rally

• AVGO surges 2.78% to $401.12, driven by Microsoft chip rumors and UBS’ $472 price target.
• Options frenzy: $420 call OI jumps 6,099 (this Friday) and $300 put OI spikes 10,253 (next Friday).
• Earnings catalyst: Q4 results (Dec 11) could push AI revenue to $6.2B, but high forward P/E (45x) poses risks.

Here’s what’s happening: The options market is betting big on AVGO’s AI-driven rally. Calls at $420–$430 and puts at $300–$310 show a tug-of-war between bulls eyeing $472+ and bears hedging downside. But the stock’s 63% AI revenue growth in Q3? That’s the real story.Bullish Sentiment in Options: Calls at $420–$430 Outmuscle Puts at $300

AVGO’s options chain is a chessboard of positioning. This Friday’s $420 call (OI: 6,099) and next Friday’s $430 call (OI: 4,657) scream "target $450+"—a 12% pop from current levels. Meanwhile, the $300 put (OI: 10,253) acts as a safety net for big players hedging a rare dip. Think of it like a tightrope walker holding a pole: the calls are the pole’s right side (confidence in upside), and the puts are the left (prudent caution). But with RSI at 69 and MACD above signal line, the technicals lean bullish. Just watch the $397 intraday low—break below that, and the $360 put OI ($3,164) could trigger panic.

Microsoft Chip Shift and Earnings Fuel the Fire

The news isn’t just noise. Microsoft’s rumored shift to AVGO’s custom chips (from Marvell) isn’t just a headline—it’s a $17.5B revenue catalyst. UBS’ $472 target isn’t out of reach if Microsoft signs. But here’s the catch: AVGO’s forward P/E of 45x is a loaded gun. If Q4 misses $17.4B or AI revenue stumbles below $6.2B, the $300 put OI could become a floodgate. Retail traders are already pricing in a "Microsoft win," but institutional hedgers aren’t sleeping—those $300–$310 puts are their insurance policy.

Trade Ideas: Calls for the Bold, Stock for the Patient

• Options play: Buy AVGO20251219C420 (next Friday’s $420 call). Why? The $420 strike has 6,486 OI and sits just 4.7% above current price. If AVGO holds $400 and pops on earnings, this call could double. Exit at $430+ to lock in gains.
• Stock entry: Buy AVGO near $397–$400 (support zone). Target $420–$430 if Microsoft rumors heat up. Stop-loss below $390. For the aggressive, a $405 call (AVGO20251212C405) offers leverage if the stock gaps up pre-earnings.
• Bear hedge: Buy AVGO20251219P300 (next Friday’s $300 put) if you’re long the stock. It’s pricey but protects against a rare selloff.

Volatility on the Horizon: Earnings as the Tipping Point

AVGO’s next 4 days are a tightrope. The options market is split: bulls are stacking calls for a $450+ run, while bears are buying deep puts to guard against a $350 drop. But the real wildcard is Dec 11. If AI revenue hits $6.2B and Microsoft confirms the chip shift? AVGO could pierce $450. If not? The $365.25 moving average (Bollinger middle band) becomes a battleground. Either way, this stock isn’t going sideways. The question is: Are you ready to ride the wave—or play defense?