AVGO climbs around 7.5% after bullish technicals and robust AI chip revenue

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Broadcom surges 7.47% today on earnings

Highlights

Broadcom posted stronger-than-expected June earnings as surging AI chip demand generated $10.8 billion in Q2 FY26 revenue and over $30 billion in orders extending to 2028.
Cumulative free cash flow reached $18.3 billion in the first half of FY26, with investors awaiting Q3 results due September 2, 2026.
Shares trade near session highs with a 7.47% gain as technicals show bullish momentum, but overbought readings and mixed signals suggest consolidation between $410.02 and $450.22 in the near term.

Order visibility through 2028 supports sentiment despite EU legal setback

Broadcom recently reported June earnings that exceeded expectations and continues to benefit from robust demand for its AI chip portfolio, generating $10.8 billion in AI chip revenue for Q2 FY26 and securing over $30 billion in related orders, offering visibility into 2028. The company's cumulative free cash flow in the first half of FY26 reached approximately $18.3 billion. Investors are also monitoring its upcoming third quarter fiscal results announcement scheduled for September 2, 2026. Additionally, Broadcom lost a European Union antitrust challenge regarding VMware legal documents, which slightly weighed on recent sentiment.

Anton Kharitonov, expert at Traders Union, highlights elevated AI chip demand and exceptional revenue growth but urges caution. He points to mixed momentum signals and overbought technicals, noting the strong price move comes amid some regulatory headwinds from the EU antitrust case. He warns that the bullish structure may lose steam if support at $410.02 fails. Macroeconomic uncertainties and indicator divergence could underpin short-term volatility. "Despite headline gains, I see the technical overextension and regulatory setbacks as warning signs — risk control is essential if price reverses."

Viktoras Karapetjanc, expert at Traders Union, sees Broadcom’s AI chip momentum fueling a robust uptrend. He notes order visibility through 2028 and strong cumulative free cash flow as underlying structural advantages. Karapetjanc emphasizes the bullish setup while anticipating further strength if resistance at $422.04 is breached. He downplays minor regulatory setbacks, focusing on the company’s growing leadership in AI silicon. "The bullish structure remains intact — strong fundamentals and surging AI demand should drive further growth for Broadcom."

Jainam Mehta, market strategist, notes Broadcom’s impressive upside gap and continued technical strength above long-term moving averages. He observes intraday volatility remains elevated, hinting at tactical trade setups near resistance and support levels. Mehta sees potential for a trend continuation if $422.04 breaks, but is alert to oscillator divergences that may offer contrarian entry points on pullbacks. "This divergence in momentum indicators means traders should watch for tactical breakout or mean reversion setups in the coming sessions."

Bullish structure confirmed as momentum signals flag overbought risks

Broadcom is trading above its 20-day, 50-day, and 200-day moving averages at $385.58, $394.68, and $366.13 respectively, confirming strong bullish structure across all timeframes. The nearest resistance is the near-term ceiling at $422.04, with immediate support at the near-term floor of $410.02. Momentum signals are mixed. The Moving Average Convergence Divergence (MACD) issues a Strong Sell, suggesting caution, but the Relative Strength Index (RSI) stands at 52.77 and gives a Buy signal. The Stochastic RSI reads 92.05 and, along with Bull/Bear Power (BBP) at 7.34, indicates overbought conditions. BBP confirms buyers currently dominate intraday action, though the Commodity Channel Index (CCI) and Awesome Oscillator are neutral, and the Average Directional Index (ADX) rests in neutral territory, reflecting limited trend strength. The stock is up $29.29 or 7.47% on the day after an upside gap of 4.71%. It is trading near the session high, with intraday volatility at 3.55%, showing sustained strength toward the highs. Momentum indicators diverge, highlighting strong price action even as oscillators warn of near-term exhaustion.

Earlier, analysts noted that Broadcom's persistent bullish momentum was supported by strong AI-driven revenue growth and continued buyer interest. The current outlook reinforces this view, with robust Q2 results and elevated demand for AI semiconductors, making the $422.04 resistance a critical level to watch for a potential breakout in the coming sessions.

Source of Data: AVGO Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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