Former House Speaker and Rep. Nancy Pelosi (D-Calif), who is an aggressive investor among the members of Congress, disclosed in late June the purchase of call options in chipmaker Broadcom Corp. (NASDAQ:AVGO). After topping out in mid-June, the stock went about a broad consolidation move.

What Happened: Trading platform TrendSpider posted a daily chart of Broadcom on X, formerly Twitter, showing a technical formation that points to bullishness ahead. The stock is on track to complete an inverse head and should pattern, having completed the left shoulder in early July and the head in mid-August.

The inverse head-and-shoulders chart pattern is typically used for identifying bullish reversals and this pattern signals a potential shift from a bearish to a bullish trend when the price breaks above the "neckline.

"Pelosi has June 2025 $AVGO calls, do what you will with this info," TrendSpider captioned the post.

Pelosi has June 2025 $AVGO calls, do what you will with this info.
 pic.twitter.com/1ucNxsAiQC

— TrendSpider (@TrendSpider) September 2, 2024

Social media users chimed in with their thoughts on the post. One of them said, "She never loses."

Why It's Important: Pelosi is a widely followed Congressional trader and interest in her stock holding is so much so that there are Pelosi portfolio trackers. Lawmakers are required to disclose their financial assets within 45 days of any transaction, with the value of trades typically mentioned in a range.

Pelosi's  20 Broadcom call options were purchased on June 24, with a strike price of $800 and an expiration date of June 20, 2025. The purchase was made after the company reported its second-quarter results on June 12 and announced a 10-for-1 stock split. The stock began trading on a split-adjusted basis on July 15.

The congresswoman's call options now have a strike price of $80, giving effect to the split. One option contract represents 100 numbers of underlying shares.  A call option gives the owner the right, but not the obligation, to buy an underlying security at a specific price within a specified time, which is the expiration date. They can also sell the call option to another buyer within the expiration date.

Broadcom is due to announce its third-quarter results after the market closes on Thursday. Given Broadcom's  AI exposure and peer Marvell Technology, Inc.'s (NASDAQ:MRVL) strong quarterly report, analysts are largely upbeat about the imminent results.

Broadcom stock, which fell to a post-split low of $128.50 amid the Aug. 5 market collapse, has  come back up. In premarket trading, the stock was down 0.49% to $162.02, according to Benzinga Pro data.

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