Perfect World - Shares Seeking Direction

Date:2011-08-22hanyue  Text Size:

New York, August 19th ( - Shares of Perfect World Co Ltd. (NASDAQ:PWRD) closed the trading day lower by $0.46 or -2.54% from its previous close. Perfect World's shares price action formed what is considered to be a doji close, where the open and close prices are very close to each other, mainly signaling an indecision between buyers and sellers.

Perfect World Co Ltd. (NASDAQ:PWRD) is an online game developer and operator based in China. The company primarily develop online games based on our proprietary game engines and game development platforms. Its portfolio of self-developed online games includes massively multiplayer online role playing games like "Perfect World," "Legend of Martial Arts," "Perfect World II," "Zhu Xian," "Chi Bi," "Pocketpet Journey West," "Battle of the Immortals," "Fantasy Zhu Xian," "Forsaken World," "Dragon Excalibur" and "Empire of the Immortals;" and an online casual game: "Hot Dance Party." Most of its revenues are generated in China, however the company also license and generates revenues worldwide.

Perfect World's current stock range is defined by a trough, which marks calculated support at $15.92 and by a peak that marked the resistance point at $18.74. These levels are closely watched by traders managing their positions.

Traders wanting to establish a position in Perfect World or traders that are already holding the stock can use the doji close to their advantage, since the pattern present a short term pause in the stock's price action. This pause results in an entry point for traders depending of which way the stock resolves this short term indecision.

Doji are important candlesticks that provide information on their own and as components in a number of important patterns. Doji form when a security's open and close are virtually equal. The length of the upper and lower shadows can vary and the resulting candlestick looks like a cross, inverted cross or plus sign. Alone, doji are neutral patterns.

Any bullish or bearish bias is based on preceding price action and future confirmation. In the case of Perfect World, given that the stock finished the session lower, bears should monitor the stock, as it could reverse if it manages to trade above today's intraday high.

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