For Arista Networks, My Price Target Is a Nice Round Number
I see a positive setup as the shares make a run higher. Here's how to play it.
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Arista Networks ANET rose Thursday after Citigroup C increased its fundamental price target on the stock. The shares have continued higher on Friday.
Arista sells computer network switches that speed up communications in internet data centers.
Let's check out the charts and indicators.
In the daily bar chart of ANET, below, I see a mixed picture. The shares are trading above the rising 50-day moving average line and above the rising 200-day moving average line.
The daily volume histogram does not show me a pattern of increasing volume unfortunately. The daily On-Balance-Volume (OBV) line has weakened since the middle of February as traders appear to be more aggressive sellers.
The Moving Average Convergence Divergence (MACD) oscillator is above the zero line but it has narrowed in recent weeks.
In the weekly Japanese candlestick chart of ANET, below, I see a positive setup. Prices are in a longer-term advance and trade above the rising 40-week moving average line.
The weekly OBV line has mirrored the advance with traders acting more aggressive as buyers than sellers. The MACD oscillator is in a bullish alignment above the zero line.
In this daily Point and Figure chart of ANET, below, I can see a potential upside price target in the $475 area.
In this weekly Point and Figure chart of ANET, below, I can see an upside price target in the $499 area. Let's round it up to $500.
Bottom-line strategy: In my November 24 review of ANET I gave the stock a $300 price target. The target was finally reached in March of this year. Traders who are still long should raise stop protection to $305. The round number of $400 is my price target now.
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