AVGO Earnings Signal Breakdown: High-Risk Binary Setup

AVGO Earnings Signal | 2025-12-11

Primary Recommendation: BUY PUTS

Conviction: 55% (Low–Medium)

Reason: Katy AI shows consistent bearish pressure despite composite model suggesting calls.

🧠 Why PUTS? (Key Evidence)
Katy AI Prediction

Predicts 0.5%–1.2% downside into the next session

85% of 420 predictions are below current price

Multiple targets near $400–401

Overbought technicals + bearish intraday momentum

Technical Setup

Current price: $405.5

Daily range: $394–$414 (trading near top)

Stochastics: 95+ (extremely overbought)

Light volume = weak support at highs

Options Flow & IV

PCR: 1.13 → mild put bias

IV: 150–210% → earnings volatility extremely high

OTM puts show unusual activity

💰 Trade Setup

Instrument: AVGO 400 PUT

Expiry: 12/12 (1-day)

Entry: $6.05 – $6.15

Target 1: $9.08

Target 2: $12.10

Stop Loss: $4.84

Position Size: 2% portfolio (high-risk)

Risk Level: 🔴 HIGH

⚠️ Risk Notes

1-day expiry → extreme theta decay

Earnings → binary outcome

Composite model shows CALL, but Katy AI + technicals favor PUT

IV crush will be severe after earnings

📝 Quick Summary

Overbought AVGO + bearish Katy AI + high IV + weak volume → short-term downside probability higher.
PUTS are the asymmetric play, but risk is high.