In his first Executive Decision segment of "Mad Money" last Friday, host Jim Cramer spoke with Jayshree Ullal, CEO of Arista Networks Inc. (ANET) , a cloud networking equipment provider.
No single company can do it all, Ullal said, which is why Arista Networks has partnered with best-of-breed companies such as Palo Alto Networks (PANW) to help secure their offerings. The company's products now seamlessly blend custom silicon hardware with proprietary software solutions, she said.
Let's check out the charts and indicators of Arista Networks to see what may happen next with its shares.
In this daily bar chart of ANET, we can see how weakness has been unfolding in recent weeks. Notice how prices dropped sharply and quickly below the 50-day moving average line. Trading volume has increased on the decline and the On-Balance-Volume (OBV) line shows a decline that started in the middle of January, telling us of a shift from aggressive buying to aggressive selling. The Moving Average Convergence Divergence (MACD) oscillator peaked back in November and has just crossed the zero line on the downside for an outright sell signal.
In this weekly bar chart of ANET, below, we can see a bearish picture. Prices are still above the rising 40-week moving average line but a tight uptrend this past year has been broken. The weekly OBV line shows a small double top pattern, which suggests a shift to aggressive selling. The MACD oscillator is crossing to the downside for a take profit sell signal.
In this daily Point and Figure chart, below, the software is projecting a possible downside price target in the $215 area, Support may appear before that area.
Bottom line strategy: ANET could bounce in the short term, but a deeper and longer-lasting correction or pullback is the more likely direction of prices.