This All-Star AI Behemoth Is a Golden Opportunity

This All-Star AI Behemoth Is a Golden Opportunity

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BY LUCAS DOWNEY, EDITOR, TRADESMITH’S ALPHA SIGNALS

Two months ago, the thought of economic prosperity was laughable.

Tales of despair and crisis were all over the mainstream financial media.

At TradeSmith Daily, we were one of the few who could imagine better days ahead. And we didn’t even have to imagine it – we proved the point with our bear killer signal on April 1… yes, the day before Liberation Day.

Kudos if you heeded that advice. Just about everything is up massively since, with the biggest performer being the Nasdaq 100 with a gain of 16% from that day.

The bear killer signal I mentioned then revolved around a juicy setup owning the Nasdaq and one of my favorite AI stalwarts: Broadcom (AVGO).

Even with AVGO up a whopping 60% since that post… I still believe it’s a wonderful bet even today.

Recently, the Nasdaq formed what is called a “golden cross.”

As I’ll show you, when it triggers it’s a blessing for tech stocks… especially those with deep AI aspirations.

Nasdaq 100 Forms Powerful Golden Cross

Few could imagine what we’re witnessing today.

As I write this, major averages are at all-time highs.

And the Nasdaq just made a golden cross formation. That’s when the 50-day moving average (MA) crosses over the 200-day MA.

This indicates that the near-term average of prices is accelerating upward, eclipsing the longer-run average price.

See below:

This level of positive momentum signals that stocks are back on the minds of traders and investors.

But should you buy the golden cross?

Let’s find out by looking backward.

Using weekly data, I went back three decades and found 17 prior instances. Here’s how I performed the study.

Whenever the 50-day MA first crosses above the 200-day MA and the prior week was below, it gets the golden cross signal.

Here’s what’s interesting about the findings.

When you go back 30 years (yellow bars below), the results are positive on average. Keep in mind some instances were caught in the 2008-2009 Great Financial Crisis and the tech crash of the early 2000s.

Those once-in-a-lifetime events skew the results down a bit.

However, check the white bars below – results from 2009 and forward. I will focus on those as I see today’s environment more similar to them.

After the Nasdaq forms a weekly golden cross since 2009:

That said, even the instances counting the major early 2000s busts aren’t too shabby either.

So, should you stay long after a golden cross?

Yes. That’s a good bet.

But let’s make it a great bet by focusing on one all-star AI behemoth that’s primed for success.

Broadcom Soars After Nasdaq Forms Golden Cross

I’ve loved Broadcom for years. I even made a bullish case on the company a year ago.

It’s one of the pillars in the AI infrastructure buildout that’s happening across the globe.

Broadcom dominates two areas: semiconductor solutions, which includes smartphones, and AI infrastructure software.

The company recently eclipsed a $1 trillion market cap, and for good reason. Business has been exploding.

Below shows just how much money is being made year after year. Revenues are slated to reach $62.9 billion vs. $51.6 billion last year.

Note the wicked profitability estimate of $32.7 billion for 2025:

Folks, this is a top-tier play.

Now, why is Broadcom the golden AI play, you ask?

Simple. When you look at the prior Nasdaq golden crosses since 2009 (when AVGO became a public company), you’ll learn that Broadcom is a great way to outperform.

Here’s a quick view of the stock the last year. It’s at all-time highs:

When the Nasdaq is breaking out, it makes sense that one of its top holdings is going to participate.

But here’s why the Nasdaq golden cross is a blessed omen for Broadcom.

When you plot the forward performance of AVGO post each of the prior nine Nasdaq golden crosses since 2010, staggering gains follow with:

To better highlight the golden opportunity, I’ve included the Nasdaq’s performance for comparison:

Let’s not mince words. The raging bull market that I keep touting is here in a big way.

Interest rates are set to decline, trade deals are finalizing, and stocks are pushing higher week after week.

It’s the type of situation where you want to be leaning into high-quality assets like AVGO.

Be picky with your stocks. Look to history for guidance, but also study the here-and-now picture.

The TradeSmith Quantum Score sizes up companies instantly with a grade. Broadcom has a rock-solid 82.8 score defined by a solid fundamental rating and blistering technical qualities.

This seals the deal for me:

The golden cross is flashing.

It’s time to be offensive… not defensive.

TradeSmith software spots tomorrow’s leaders, today.

That’s pure gold if you ask me.

And as a reminder, our new AI trading tool, TradeSmithGPT, just flagged its top three trades for the 2025 bull market.

At 1 p.m. Eastern today, we’re giving away those three opportunities for free.

All you have to do is click here and watch this special briefing from TradeSmith CEO Keith Kaplan.

In this briefing, Keith gives you a live demonstration of TradeSmithGPT’s power… reveals exactly how this breakthrough AI software works… and explains why AI is critical for trading this new bull market.

However, today’s the last day that Keith’s presentation will be online. That means if you want to get TradeSmithGPT’s first three trades, you need to take action now.

I don’t want you to miss out on these three exciting opportunities. So click here now to get started.

Regards,

Lucas Downey
Editor, TradeSmith’s Alpha Signals