The semiconductor industry remains the epicenter of market volatility and growth in 2026 thanks to an insatiable demand for hardware as the artificial intelligence (AI) buildout continues. Two industry titans in the semiconductor space, Broadcom (AVGO) and Nvidia (NVDA), delivered high-impact news that could provide ample opportunities for traders in the following single-stock ETF pairs: the Direxion Daily AVGO Bull 2X (AVL)/ Direxion Daily AVGO Bear 1X Shares (AVS) and the Direxion Daily NVDA Bull 2X Shares (NVDU)/ Direxion Daily NVDA Bear 1X Shares (NVDD).
AVGO data by YCharts
Broadcom Q1 Earnings
On March 4, Broadcom released their fiscal Q1 earnings report that revealed an earnings per share (EPS) of $2.05, beating analyst estimates of $2.02. Revenue reached $19.31 billion, ousting the $19.21 billion estimates. Notably, the company issued an aggressive Q2 revenue guidance of approximately $22.0 billion, which tracks significantly higher than Wall Street’s $20.40 billion estimate, which should appease bulls.
As traders know, however, everything may look fine on paper, but the market reaction can provide a stark contrast. That’s why in addition to AVL, traders can use AVS if the market reaction following an event like an earnings announcement doesn’t go as planned.
“Broadcom faced a quarter in which ‘Beat and raise’ no longer ensured a favorable response from the market,” said Jake Behan, Direxion’s Head of Capital Markets. “With its valuation surpassing even that of Nvidia, expectations were exceptionally high, making it even more challenging for the company to deliver results that would catalyze a move higher.”
Nvidia and OpenAI
Also this week, Nvidia CEO Jensen Huang ignited market interest during a Morgan Stanley conference by discussing the company’s strategic relationship with OpenAI. Huang noted that Nvidia’s $30 billion investment in the ChatGPT maker is likely its last ahead of the company potentially going public by year’s end. For those looking at the long-term ramifications of this partnership, Huang reaffirmed Nvidia’s hardware as an important component in the ever-expanding generative AI ecosystem.
Traders sensing bullish vibes from Huang’s strategic vision can double up on Nvidia exposure with NVDU. More cautious traders who think the AI hype may have run its course and is outpacing reality, NVDD is a hedge against any price pullbacks.
“For traders navigating that volatility, NVDU can be used to magnify upside when positive momentum drives Nvidia higher, while NVDD may help hedge against the headline risk,” said Ryan Lee, Direxion’s Senior Vice President of Product and Strategy. “Given Nvidia’s ripple effects across semis and the broader indices, these tools are built for tactical, short-term positioning around major market-moving events.”
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