Broadcom just put up numbers that scream “strong business”… and the stock still got treated like it failed a pop quiz. That doesn’t add up, and if you felt that little mental glitch this week, you’re not crazy.

The loud narrative says the same thing every time: “AI is peaking, valuations were stupid, this is the unwind.” Clean, simple, and totally satisfying if you like tidy stories.

But the market doesn’t move on tidy stories. It moves on positioning, expectations, and where pain lives.

And right now, the pain isn’t in Broadcom’s results. The pain is in the gap between what people paid for perfection… and what a normal strong quarter looks like.

Here’s the overlooked signal: when a high-quality stock sells off after solid fundamentals, it’s often not a thesis break. It’s a reset. Sometimes the healthiest thing a winner can do is disappoint the crowd for a quarter.

That’s what I want to unpack today, because this is exactly where most investors get chopped up. They either panic-sell a compounding machine… or they average down with zero plan and call it “conviction.”

In today’s issue, I’m going to strip Broadcom down to two things that actually matter: what the latest quarter says about the business, and what the chart says about sentiment.

Then in This Week’s Focus, I’ll walk through the real setup I’m watching in AVGO, using visible price levels you can track, what would confirm the recovery, and what would tell us to step back and wait.

No hype, no hero trades. Just signal over noise, so you can stop reacting to every candle and start thinking like a grown-up again.

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Citi analysts say widespread selling pressure in software and AI-related stocks — driven by fear that artificial intelligence could disrupt business models — has created select buying opportunities in names they view as fundamentally strong. While sentiment has soured and valuations compressed, the bank highlights companies with durable franchises, predictable revenue streams and strong balance sheets. For patient investors, this could be a chance to accumulate quality software stocks at discounts, especially those with resilient enterprise demand.

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Despite strong employment data and cooler inflation prints — two metrics that typically encourage risk assets — markets have stalled rather than rallying, prompting questions about whether investors are simply priced for perfection. The article suggests that markets may already be anticipating good news, meaning incremental improvements aren’t fueling further upside. Instead, market attention is shifting to earnings growth, geopolitical risk and central bank communication as key drivers for the next leg of returns.

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If you asked 10 investors what’s going on with Broadcom right now, 9 would give you the same answer: “It’s an AI winner… but it got too expensive, too fast.”
And honestly, that view isn’t crazy.

Broadcom ripped into late 2025, then reality showed up with a clipboard. The stock tagged a 52-week high around $414 and has since slid to the low-$300s. That’s roughly a ~22% drop from the peak. When a stock does that, people don’t ask “what’s next?” They ask “what broke?”

The headlines don’t help. The AI trade is crowded, every quarter is treated like a championship game, and anything short of “we’re doubling again” gets punished.
So the “consensus” becomes boringly simple: AI demand is real, but expectations are unreal.

Positioning follows that narrative too. When a stock gets labeled “priced for perfection,” money gets skittish. You see it in the way people trade it: tight stop-losses, short-term profit-taking, and a quick trigger finger the moment the chart turns ugly.

But here’s the crack in the armor that kept me digging: Broadcom didn’t report a broken quarter. It reported a strong one.
So why does the stock feel like it’s on trial?

Here’s the part most people miss: the market doesn’t punish “bad companies.” It punishes “wrong expectations.”
And Broadcom is a perfect example of that psychological trap.

Broadcom just posted quarterly revenue around $18.0B (+28% YoY) and threw off about $7.5B in free cash flow (roughly 41% of revenue). That’s not a shaky business. That’s a cash engine.

The AI side was also not subtle. AI semiconductor revenue grew fast (management cited ~74% YoY in the quarter), and guidance talked about AI momentum continuing into the next quarter. They also talked about a massive AI backlog (north of $70B). That’s not “AI is slowing.” That’s “AI is still buying.”

So why did the market react like it smelled smoke?

Because the bar wasn’t “good quarter.” The bar was “good quarter plus an even more insane forward narrative.”
Broadcom is no longer traded like a company. It’s traded like a belief.

And belief stocks have a brutal rule:
When everyone already believes the good news, the next move depends on what isn’t said.

Investors wanted one of these:

Instead, they got something more realistic: strong numbers, strong guidance, but not a fireworks show big enough to justify the old price.

That’s why you can get a beat-and-raise situation… and still see selling. It’s not because the fundamentals collapsed.
It’s because the stock price had been doing victory laps ahead of the facts.

And here’s the “why now” part: after a pullback like this, the crowd changes.
The weak hands leave. The time horizon shifts from “next week” to “next year.”
That’s where mispricings are born.

Here’s how I’m framing this in plain English:

This isn’t a broken business. This is a premium business going through a premium-to-reasonable reset.
That’s very different from a thesis that says “the story is dead.”

But I’m not going to pretend fundamentals alone tell you when to step in. With a stock like this, timing matters because volatility is part of the package.

So I combine the two lenses:

1) The fundamental floor (why it’s not “un-investable”)
Broadcom generates a ridiculous amount of cash and is tied to two powerful engines: semiconductors and infrastructure software. That means even when the stock gets moody, the business doesn’t instantly evaporate.

This matters because it changes your posture. You’re not trading a meme. You’re tracking a cash-producing machine that just got repriced.

2) The price map (what you can actually see on a chart)
Right now, Broadcom is basically telling you one story:

So the actionable framework is simple:

📍 Zone A: $320–$325 (line in the sand)
This is the “buyers must show up” level. If the stock keeps tagging this area and bouncing, it tells you institutions are defending a price they’re comfortable owning.

How I use it:

📍 Zone B: $345–$355 (first serious resistance)
This is where a lot of trapped buyers from the breakdown start selling “to get back to even.” It’s also where short-term traders take profits.

How I use it:

📍 Zone C: $380–$392 (the “prove it” zone)
This zone matters psychologically because it’s where the stock often looks “safe again” to the crowd. But the crowd is usually late.

How I use it:

📍 Zone D: $414 (the old peak)
That’s the “we’re back” level. But don’t worship it. Use it as a reference for sentiment.

The strategy lens (no hype, just process):

And here’s the biggest psychological edge most people ignore:
You don’t need to catch the first 5%. You need to avoid the next -15%.
That’s how you stay in the game long enough to benefit when the market finally re-rates the story again.

📊 Next 30 days: Watch how price behaves around $320–$325
If AVGO keeps dipping into that zone and snapping back, that’s accumulation behavior. If it slices through and can’t reclaim it, step back and let it find a lower shelf.

📈 Next 90 days: Watch for a clean reclaim of $345–$355, then consolidation above it
One strong green day means nothing. What matters is teaching the market a new habit: higher lows + holds above resistance.

🚨 Red flag: A decisive breakdown below $320 with expanding volume and no quick reclaim
That’s when this becomes less “reset” and more “repricing.” And repricings don’t care about your thesis.

My honest ending:
If you’re staring at Broadcom right now and feeling that itchy urge to “do something,” good. That’s the emotion that ruins most investors.
The better move is boring: let the stock prove it can hold a floor, then let it prove it can climb back over resistance.

Because hype doesn’t last.
But a business that prints cash and sits in the middle of the AI plumbing? That tends to come back when the market stops being dramatic.

The best marketing ideas come from marketers who live it. That’s what The Marketing Millennials delivers: real insights, fresh takes, and no fluff. Written by Daniel Murray, a marketer who knows what works, this newsletter cuts through the noise so you can stop guessing and start winning. Subscribe and level up your marketing game.

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This week felt like one of those classic market weeks where the business stays steady… and the stock price throws a tantrum anyway. Broadcom prints real numbers, talks about real demand, and the chart still makes people second-guess themselves like they’ve done something wrong. That’s the emotional trap: when price drops, your brain starts hunting for a “story” that justifies panic. And when the AI narrative is involved, the noise gets louder because everyone’s trading expectations, not evidence. You can almost feel the fatigue in the tape, the constant urge to react, to adjust, to “not be late.” That’s how good investors get turned into anxious traders.

Here’s the reset I’m taking into the weekend: I don’t need to win the next candle, I need to be right about the next phase. My edge doesn’t come from guessing where AVGO bottoms. It comes from letting the chart confirm the floor, and letting the fundamentals justify the patience. If Broadcom is truly a cash machine tied to AI infrastructure, then short-term drama is the toll you pay for long-term upside. The move isn’t to force conviction, it’s to define the line that would break it and stay calm everywhere else. When the market slows down, real clarity speeds up. And the investors who win aren’t the ones who react fastest, they’re the ones who react least until the signal is undeniable.