To The Moon

JPMorgan’s recent "aggressive buy" call on $Broadcom(AVGO)$ on June 18 came at a perfect psychological turning point. The stock had shed nearly 7% in the weeks prior due to unconfirmed supply chain rumors regarding delays in its $Alphabet(GOOGL)$ Google TPU v9 AI chip program. Analyst Harlan Sur essentially called the market’s panic "overdone," reminding everyone that Broadcom’s multi-year custom ASIC (application-specific integrated circuit) pipeline with Google, $Meta Platforms, Inc.(META)$ Meta, and Anthropic remains fully intact, targeting a $580 price level long-term.

As an existing investor looking at the week of June 22–26, I am navigating the classic dilemma: ride the analyst-driven momentum, or hedge against broader macro headwinds from last week's hawkish Federal Reserve commentary.

I am holding Broadcom for long-term semiconductor play, and here is how I would break down my choices based on my trading style and time horizons. You can take a look and see which one might suit you.

Option 1: Continue to "Load Up" (Long-Term Equity)

If your goal is multi-year wealth compounding, continuing to accumulate shares here makes strong fundamental sense, though dollar-cost averaging (DCA) is preferred over a single lump-sum.

• The Bull Case: Broadcom isn’t just riding an AI hype wave; it has concrete fundamentals. Its custom AI silicon revenue is guided to cross $16 billion this year alone (a 200%+ increase year-over-year). Furthermore, management just completed a massive capital optimization move, retiring $3 billion in long-term debt to fortify its balance sheet.

• The Risk: Tech valuations are rich. Loading up aggressively after a 4%+ single-day surge leaves you exposed to immediate short-term pullbacks if macro conditions turn sour.

For now, I think at the current price, it might not be a good time to load up especially after a 4%+ single-day surge, there might be another correction as the market digest the news of new Fed’s hawkish comments on rate decision.

Option 2: The Short-Term Bull Put Spread (30–45 Days Out)

Playing a Bull Put spread in the July/August expiration window is a highly effective way to capture high options premium inflated by the recent volatility, while giving yourself a margin of safety.

• The Strategy: Sell an Out-of-the-Money (OTM) Put and buy a further OTM Put for a net credit.

• Where to set strikes: Look to set your short put strike below the recent pre-upgrade consolidation floor (around the $375–$385 range, where it traded before JPMorgan's note).

• The Verdict: Highly viable. Short-term spreads allow you to capitalize on the stock's strong technical support floor. Even if the hawkish Fed commentary drags the general market down slightly, AVGO has a powerful structural tailwind keeping it insulated from a total freefall.

I might be taking this opportunity to play the Bull Put spread option on short term, as the expected move suggest that we might be able to see a strong technical support bullish move in next 30-45 days after a consolidation.

Here is how I would play the Bull Put spread with expiration date on 24 July 2026.

Option 3: The Long-Term Bull Put Spread (70+ Days Out)

Going out 70+ days (September or later expiration) shifts the dynamics completely.

• The Mechanics: Long-dated spreads give you a massive buffer, but time decay (theta) moves much slower. You will be holding this position through a longer macro window.

• The Risk Factor: A longer timeline forces you to absorb more general market risk, macro data releases, and potential shifts in enterprise AI spending.

• The Verdict: Less optimal right now. If you are going out 70+ days on a premium-selling strategy, you want to sell when implied volatility (IV) is exceptionally high. Because JPMorgan just stabilized the stock, IV might begin to crush (drop), meaning you aren't getting compensated enough for taking on over two months of market risk.

For playing Bull Put spread for longer (e.g. 70 days), we might need to look at the IV, and currently we are seeing that the volatility skew seems to flatten for expiration on 22 Sep 2026, this might not be a good time to look at it as we might not going to be compensated enough to take on market risk over 2 months.

The Macro Factor: Should You Wait and Monitor the Fed?

The macro backdrop for this week (June 22–26) cannot be ignored. Hawkish Fed comments imply that interest rates may stay higher for longer to cool inflation, which traditionally pressures high-multiple tech stocks.

If you are a conservative trader, waiting until mid-week is a very smart play. Let the market digest the Fed's stance on Monday and Tuesday. If tech takes a broad macro hit, Broadcom might experience a minor, sympathy pullback.

The Tactical Sweet Spot: Wait for a macro-driven down day early in the week. If AVGO pulls back slightly on overall market weakness—not company-specific news—that is your optimal entry point to sell the 30–45 day Bull Put spread. You will get higher premiums for your short puts while using the JPMorgan structural support as your floor.

To design a 30-45 day Bull Put Spread for Broadcom (AVGO), we first look at the immediate technical landscape following JPMorgan’s upgrade on June 18.

AVGO is currently trading at around $411.35. Looking at the charts over the last few weeks, the stock established clear technical levels:

• Current Resistance: ~$413–$418 (the pre-panic consolidation ceiling and recent high).

• Immediate Support (Floor 1): ~$392–$395 (the gap-up level triggered by the upgrade).

• Major Support (Floor 2): ~$372–$377 (the recent swing low established on June 10 and 16 before the JPMorgan defense).

For a 30-45 day expiration window (targeting late July or early August 2026), here are three distinct options risk-profiles—Aggressive, Balanced, and Conservative—structured using a standard $5 width spread.

Profile 1: The Aggressive / Aggressive Income Setup

This profile is for traders who believe JPMorgan's upgrade put a definitive hard bottom on the stock and expect AVGO to maintain its momentum or consolidate right around its current price.

Strikes to Trade:

• Sell $400 Put (Just below psychological support)

• Buy $395 Put (Protective leg)

Risk-Reward Dynamic:

• Estimated Net Credit: ~$1.65 to $1.90 per spread

• Max Risk: ~$3.10 to $3.35 (Width of strikes minus credit)

• Probability of Profit (POP): ~60%

Strategic Takeaway: You are collecting a high premium relative to your risk, but your buffer is thin (less than 3% below the current spot price). If the hawkish Fed comments trigger a broader market correction early in the week, this spread will face immediate heat.

Profile 2: The Balanced / Sweet-Spot Setup

This is the most optimal setup. It places your short put below the immediate support floor ($392) but above the worst-case drop level, capitalizing on the "upgrade bounce."

Strikes to Trade:

• Sell $390 Put (Sits securely under the $392-395 post-upgrade floor)

• Buy $385 Put (Protective leg)

Risk-Reward Dynamic:

• Estimated Net Credit: ~$1.10 to $1.30 per spread

• Max Risk: ~$3.70 to $3.90

• Probability of Profit (POP): ~70%

Strategic Takeaway: This offers an excellent blend of risk and premium. AVGO has to drop more than 5% for your short strike to bleed. Even if macro headwinds pull the market down, the custom AI chip pipeline structural narrative should logically defend the $390 area.

Profile 3: The Conservative / Sleep-Well-At-Night Setup

For traders who are genuinely worried about the hawkish Fed commentary dragging mega-cap tech down but still want to generate income using AVGO's major structural floor.

Strikes to Trade:

• Sell $380 Put (Safely below the deep June 16 swing low of $376.71)

• Buy $375 Put (Protective leg)

Risk-Reward Dynamic:

• Estimated Net Credit: ~$0.65 to $0.85 per spread

• Max Risk: ~$4.15 to $4.35

• Probability of Profit (POP): ~80%+

Strategic Takeaway: Your margin of safety is massive—almost an 8% drop buffer from current levels. The trade-off is a lower return on capital. However, if you wait until a broad tech sell-off early in the week to open this, the premium on the $380 put will temporarily spike, letting you enter this conservative trade at a much better price.

Trade Management Rule of Thumb

For all three profiles, your profit target should be 50% to 60% of the maximum credit received. Because these are 30-45 day options, theta (time decay) will accelerate significantly in the final 20 days. Don't feel obligated to hold until expiration day; take your profits when the premium melts, and eliminate the tail-risk of a sudden macro event.

Summary

Following JPMorgan’s "aggressive buy" upgrade on June 18, 2026, which defended Broadcom’s (AVGO) custom AI chip pipeline and pushed the stock up over 4%, investors face a choice between long-term equity accumulation and short-term options strategies. While Broadcom's fundamental narrative remains exceptionally strong with projected custom AI silicon revenue crossing $16 billion this year, broader macro headwinds from recent hawkish Federal Reserve commentary warrant a tactical approach for the week of June 22–26.

For options traders, implementing a Bull Put spread with a 30–45 day expiration is highly viable because it allows investors to capture inflated premium while leveraging new technical support floors. In contrast, longer-dated spreads (70+ days) are less optimal right now due to slower time decay and extended exposure to macro volatility.

Based on AVGO's current trading price of approximately $411.35, three distinct risk-reward profiles using $5-wide spreads offer targeted ways to trade the stock:

• Aggressive Setup (Sell $400 / Buy $395): Collects a high premium (~$1.65–$1.90) but offers a thin buffer of less than 3% above the short strike, making it vulnerable to immediate macro pullbacks.

• Balanced Setup (Sell $390 / Buy $385): The optimal sweet spot, placing the short strike safely below the post-upgrade floor of $392–$395. It collects a solid premium (~$1.10–$1.30) with a 70% probability of profit.

• Conservative Setup (Sell $380 / Buy $375): Offers an 8% downside buffer by placing the short strike below the major June swing low of $376.71. It yields a lower premium (~$0.65–$0.85) but boasts an 80%+ probability of profit.

Tactical Recommendation: Conservative investors should monitor market action early in the week to let the market digest the Fed's stance. Entering a Balanced or Conservative Bull Put spread on a macro-driven tech dip will maximize the premium captured while utilizing Broadcom's strong structural support as a safety cushion. Profits should ideally be taken at 50% to 60% of the maximum credit received to avoid late-stage expiration risks.

Appreciate if you could share your thoughts in the comment section whether you think using option Bull Put spread for 30-days expiration would be useful in capturing the near-term bullish sentiment for AVGO.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire @MillionaireTiger appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.