In the same skillet, stir-fry the garlic, bell peppers and remaining 2 tablespoons ginger, keeping them crisp-tender. Deglaze the skillet with the sherry and scrape up any brown bits.
Add the reserved soy mixture and cook until the mixture boils, about 1 minute. Whisk together the cornstarch and remaining 1/4 cup soy in a small bowl, then stir the slurry into the skillet.
Add the cashews, water chestnuts, and 1/4 cup water to thin the sauce. Cook for another minute.