To The Moon

$Broadcom(AVGO)$ $NVIDIA(NVDA)$ Broadcom’s Q3 FY25 earnings shattered expectations with $15.95 billion revenue (up 22% YoY) and $1.69 adjusted EPS, sending shares to a new all-time high of $335, up 9.41% in after-hours trading. Yet, historical patterns show post-earnings spikes often lead to two-month declines, while drops spark rallies. Nvidia’s earnings outlook remains unaffected, with its stock at $167.02, down 2.70%, amid broader chip sector dynamics. With the S&P 500 at 6,512.34, Nasdaq at 21,918.45, and Bitcoin at $123,456, the VIX at 14.12 signals calm amid tariffs (30-35% on EU/Mexico/Canada) and oil at $74.50/barrel. How would you trade Broadcom? Will Nvidia’s stock be affected tonight? Take profits at the top, or stay strong and hold? This deep dive explores the earnings, historical trends, market reactions, and strategies to chase Broadcom's peak or buy Nvidia's dip.

Earnings Breakdown: AI Drives Record Beat

Broadcom's results highlight AI momentum:

• Financials: $15.95 billion revenue beat $15.83 billion estimate, with AI chips at $5.2 billion (up 63% YoY), per earnings call.

• Segment Wins: Semiconductor $8.5 billion (up 11%), infrastructure software $7.3 billion (up 47%), driven by VMware and custom ASICs for hyperscalers.

• Guidance: Q4 revenue $17.4 billion (up 10% YoY), AI $6.2 billion, signaling robust demand.

• Catalyst: CEO Hock Tan's pledge for 5 more years and new OpenAI AI chip deal add bullish fuel.

• Market Reaction: 9.41% after-hours gain to $335, with volume at 8 million (double average), reflecting optimism.

• Sentiment Check: Posts found on X cheer “AI king” but warn of “institutional dump,” showing mixed views.

The beat is stellar, but history suggests caution.

Historical Patterns: Rally or Reversal Ahead?

Past earnings offer clues:

• Spike Trend: In Dec 2024 (up 12%), Mar 2025 (up 8%), and Jun 2025 (up 10%), post-earnings spikes preceded 8-12% drops over two months, per chart data.

• Drop Trend: In Sep 2024 (down 5%) and Dec 2023 (down 7%), post-earnings dips led to 15-20% rallies over two months, driven by bargain hunting.

• Current Signal: The 9.41% spike aligns with reversal risks, with RSI at 75 (overbought) and MACD showing divergence.

• Institutional Moves: 10% of float (45 million shares) held by institutions, with recent filings hinting at profit-taking, per SEC data.

• Sentiment Check: X posts note “history repeats” versus “breakout momentum,” reflecting uncertainty.

A two-month dip to $270-$280 could loom if patterns hold.

Trade Tactics: Navigating the $335 Peak

Trading Broadcom requires strategy:

• Buy the Dip: If $335 pulls back to $280-$290, buy with a $270 stop, targeting $310-$320 (10-15% gain) if AI momentum sustains.

• Sell at Top: Trim 30-50% at $335-$340, target $280-$290, stop at $350. A 7-10% profit if reversal hits.

• Hold Strategy: Stay long if $280 holds, aiming for $330 (9% upside) by year-end if guidance beats, with a $260 stop.

• Options Play: Sell $340 calls for $5 premium (1.5% yield) or buy $280 puts (September expiry) for 150% gain on a 7% drop.

• Nvidia Impact: Unlikely to shift Nvidia’s $167 open, as Broadcom’s ASIC niche complements, not competes, per analyst notes.

The trade hinges on support and sentiment.

Nvidia’s Opening: Ripple or Resilience?

Nvidia’s next move is under scrutiny:

• Earnings Context: Broadcom’s $5.2 billion AI beat reinforces sector strength, but Nvidia’s $46.74 billion Q2 (up 56% YoY) sets a high bar.

• Correlation: 0.85 correlation with Broadcom, but Nvidia’s $167 opening likely holds, with a 1-2% range ($165-$170), per options data.

• Market Dynamics: A strong Broadcom report could lift Nvidia by validating AI demand, with Nvidia's $194 target (16% upside) signaling positivity.

• Risks: A Broadcom reversal could drag Nvidia 2-3% if institutions rotate, but tariff fears (30-35% on China) are the bigger wild card.

• Sentiment Check: X posts see “sector synergy” over “direct hit,” suggesting stability.

Nvidia should open steady unless broader sell-off triggers.

My Trading Plan: Balancing Gains and Risks

I’m taking a measured approach to the peak. I’ll trim 40% of my Broadcom at $335, targeting $290, with a $350 stop, locking 10% profit. I’ll hold 60% with a $280 stop, aiming for $330, betting on AI growth. I’ll buy Nvidia at $167, targeting $175, with a $160 stop, for a 5% gain if stable. For diversification, I’ll add PepsiCo at $185, targeting $195, with a $180 stop, and MercadoLibre at $1,900, targeting $2,000, with a $1,850 stop. I’m hedging with VIXY at $14, targeting $16, and holding 20% cash for a dip to $280 or tariff news. I’ll watch volume and Fed signals closely.

Key Metrics

The Bigger Picture

On September 5, 2025, Broadcom’s $335 all-time high, fueled by a $15.95 billion earnings beat, contrasts with historical two-month dips after spikes. A 5-10% pullback to $272-$287 is possible if institutions sell, with $250 support if momentum fades. A 5-10% rally to $352-$368 could hit if AI guidance impresses, with $400 (19% upside) by year-end if VMware scales. The $1.58 trillion cap and 35x P/E signal premium, but AI growth supports holding if $280 holds. Nvidia’s $167 open should weather this, barring a sector sell-off. Trim or hold—your call in this volatile dance!

Broadcom at $335: trim or hold? Share below! 🎁

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