Broadcom Inc. (AVGO) Technical Analysis

Price Action Analysis

Overview:

The current price is approximately $340.36. Price action on the attached daily and weekly charts shows a recent pullback after a pronounced rally to the upper end of the range, with near-term support forming around the low- to mid-$340s and a longer-term uptrend still intact above the major long-term moving averages.

Daily Chart (3-month view)

Trend context: After a sharp rally into early to mid-December, price has cooled and pulled back into the 340s. The recent candles show a mix of green and red bodies with smaller real bodies, indicating a balance between buyers and sellers in the short term.
Key levels:
- Immediate area around $340–$345 appears to be acting as near-term support (recent lows in the 12/16–12/19 window). The current price sits near this zone.
- Resistance remains near the late-2010s/early-2020s high area around $410–$415 (recent swing highs on the daily).
Candlestick structure:
- Several pullback days with sizable red candles suggest distribution pressure or lack of follow-through buying, followed by attempts to stabilize near the 340s.
Volume behavior:
- Volume tends to spike on notable moves (breakouts toward new highs and sharp reversals) but has been less decisive on the latest consolidation, consistent with a quieter near-term trading range.

Weekly Chart (2-year view)

Trend context: The longer-term trend remains bullish, with price drifting higher over multiple years and holding above the major long-term moving averages.
Key levels:
- Long-term resistance around the highs near the 410–420 zone remains a hurdle for a sustained breakout.
- Intermediate support levels align with prior swing lows and the area around the 340s identified on the daily chart.
Pattern context:
- The weekly chart shows higher highs and higher lows over a multi-quarter horizon, suggesting the uptrend remains intact unless price breaks decisively below major supports.

In short, the stock is currently in a near-term consolidation with a bullish longer-term backdrop. The immediate price action around the 340 area is critical for defining the near-term bias.

Technical Indicators

Summary of key readings (as of the latest data):

Indicator	Value	Interpretation / Implication
Current Price	$340.36	Near-term support test zone around $340; hovering below the 50-day MA.
50-day Moving Average (MA50)	$361.50	Price is below MA50, implying near-term weakness; MA50 currently acting as a dynamic resistance.
200-day Moving Average (MA200)	$283.10	Price above MA200, indicating the longer-term uptrend is intact.
RSI (14)	33.90	Approaching oversold territory; potential for a short-term bounce if price stabilizes.
MACD (12,26,9)	MACD = -5.90, Signal = 2.00	Negative momentum; bearish tilt in the near term, though oversold RSI could foreshadow a rebound.

Notes:

The MA50 being above the current price reinforces the near-term bias toward resistance and possible retest of the 340–345 zone before any sustained move higher.
The MA200 above-below relationship confirms a bullish longer-term context, even as near-term momentum remains soft.
RSI in the low-30s suggests selling pressure has eased somewhat and a cautious bounce could occur if price hold above current supports.
MACD remains negative with a wide gap to the signal line, signaling ongoing downside pressure unless buyers gain control and MACD re-approaches the zero line.

Volume & Momentum Analysis

Near-term momentum has deteriorated (negative MACD and lower RSI relative to overbought levels), consistent with the current pullback.
Volume patterns around the recent rally to the highs suggest accumulation during the move into the 410 area, but the subsequent pullback shows mixed or lighter volume on down days, implying a potential lack of strong institutional selling pressure yet.
The combination of a bearish MACD and oversold RSI hints at a possible short-term bounce if price finds footing near support, but a sustained run above the MA50 would be a more robust sign of renewed bullish momentum.

Key Buy/Sell Levels

Current price: approximately $340.36

Proposed buy zones (near-term focus with touch status and distance if not touched):

Zone A (Near-Term Support / Buy Zone): $336–$342
- Has the price already touched this zone? Yes. The current price sits within this range.
- If the zone is tested again, expectations are for a potential rebound if volume supports it and the price can stabilize above the zone.
- How it aligns technically: This zone sits directly around the near-term support, aligns with the recent swing lows in the 340s, and is just below the MA50, making a quick test of the moving average a potential catalyst for a bounce.
Zone B (Deeper Support / Secondary Buy Zone): $320–$335
- Has the price already touched this zone? Not within the most recent action; current price is in Zone A.
- Distance from current price (to Zone B endpoints):
  - To 335: about $5.36 lower (-1.58%)
  - To 320: about $20.36 lower (-6.00%)
- If price declines toward Zone B with increasing volume, this area could attract buyers seeking a larger cushion against the MA50 barrier and a continuation of the longer-term uptrend above MA200.
- How it aligns technically: This level aligns with prior intraday swing lows and provides a more conservative buffer if the current support area fails.

Trendlines drawn (as reference notes):

Support line at approximately $340 (horizontal line reflecting near-term support). This line is anchored at current levels and extended forward to project into the near term, indicating where buyers may re-emerge.
Resistance line at approximately $410 (horizontal line reflecting a major upper boundary from the recent swing high). This line extends forward to highlight the backdrop for a potential breakout attempt above the current consolidation range.

Notes on how these levels fit with other references:

The $340–$342 zone corresponds with the observed near-term floor in price action and sits just below a test of the 50-day moving average, which could act as a catalyst for a bounce if buyers step in.
The $410 resistance aligns with the upper boundary of the recent swing highs; a break above would require convincing volume and momentum and would shift the near-term bias toward a more constructive technical stance.
Volume clusters around the support and prior breakout levels often provide context for the strength of a move; sustained price action through these zones with volume confirmation would be key for a reliable entry.

Technical Outlook & Summary

Near-Term View:
- Bearish tilt remains given price below the 50-day moving average and negative MACD, while RSI sits in oversold territory (~34). A near-term bounce is plausible if price holds support around $340 and fails to break below Zone B decisively, especially with price action turning higher on improving volume.
- A rally back above the MA50 ($361–$362 region) with convincing volume would be a clear bullish signal, targeting the $380–$400 area and, ultimately, the $410–$415 resistance zone.
Medium-to-Long-Term View:
- The longer-term trend remains bullish since the price is above the 200-day moving average and the weekly chart shows higher highs over a multi-quarter horizon. A sustained breakout above $410 would be a meaningful development signaling renewed upside potential.
Trading implications:
- Immediate focus remains on support around $340; a drop through Zone B with high volume would raise the risk of a deeper pullback toward the next major support near the low $320s.
- Conversely, a daily close back above the MA50 with volume acceleration could precede a test of the $380–$400 region and then the $410 resistance.

Overall assessment:

AVGO is in a nuanced technical state: long-term uptrend intact, but near-term momentum has softened. The key macro layers to watch are the near-term support around $340 (and Zone B at $320–$335) and the resistance around $410. A price recovery above the MA50 with stronger volume would tilt the balance toward a constructive setup for a move back toward the prior highs, while a break below Zone B would suggest additional downside risk toward the next cluster of support.

If you’d like, I can expand the levels with additional potential zones (e.g., additional intraday greens for pullbacks) or simulate a quick scenario-based plan (bullish vs. bearish confirmation rules) based on your preferred time horizon.

Finance Halo