How does market manipulation work?

[MonkeyMarcel]

Hi Guys

I am referring strictly to how stock exchanges are manipulated via bids, not to media manipulation via forums, blogs, etc.

From what I understand is that manipulators start selling their stock at cheap prices in small batches at a time, and over a period the price starts dropping, non-manipulators see this and start to panic by selling their stocks cheaply too,  then the manipulators buy the stock when the price is down. Amiright?

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[Progressive]

Basicly yes. It similar to the possibility of USD/BTC rate manipulation (due to same bid/ask system).
One can manipulate market if he has enough shares - e.g. somebody holding few hundreds of AM shares could destroy the price on BTCT by dumping them, then buying back from panic sellers (if he is lucky). The same goes for big BTC whales manipulating Gox.

EDIT: also you can spice the sell-off with some nice DDOS.

[MonkeyMarcel]

Basicly yes. It similar to the possibility of USD/BTC rate manipulation (due to same bid/ask system).
One can manipulate market if he has enough shares - e.g. somebody holding few hundreds of AM shares could destroy the price on BTCT by dumping them, then buying back from panic sellers (if he is lucky). The same goes for big BTC whales manipulating Gox.

EDIT: also you can spice the sell-off with some nice DDOS.

DDOS?! So sneaky! So how many shares do I need to do this? *Jokes

But seriously, how many ActM shares would it take to manipulate the price? I have a feeling it is happening right now but I am not sure what to look for. What ways are there to spot if a stock is being manipulated?

Also, how many shares does it take to become a "whale"?

[marcovaldo]

Or you can put a wall ...

For example if the price is 100 usd / btc and you want to buy some btc, you need the price to decrease.
You just put a sell order at 105 usd / btc with like 20k btc.

Everyone will see that and think that a lot of bitcoins are in the market to be sold, so they will sell it, and the price will decrease.
Of course, if the price increases a little bit, you will cancel your sell order before it got processed.

[pheaonix]

Basicly yes. It similar to the possibility of USD/BTC rate manipulation (due to same bid/ask system).
One can manipulate market if he has enough shares - e.g. somebody holding few hundreds of AM shares could destroy the price on BTCT by dumping them, then buying back from panic sellers (if he is lucky). The same goes for big BTC whales manipulating Gox.

EDIT: also you can spice the sell-off with some nice DDOS.

DDOS?! So sneaky! So how many shares do I need to do this? *Jokes

But seriously, how many ActM shares would it take to manipulate the price? I have a feeling it is happening right now but I am not sure what to look for. What ways are there to spot if a stock is being manipulated?

Also, how many shares does it take to become a "whale"?

ugh i was going to show you a great video about this but it was deleted. basically you need enough coins to cause a panic and then enough capital left over to reap the rewards. you can then chain them together and swing the price the other way around. it takes good timing, a bit of luck, coordination with multiple people or sophisticated software. then again the price is manipulated whenever us plebs trade too, so.

but it is real and it does work. it abuses bots and people's emotional response to get them to do bad short term trades.

[MonkeyMarcel]

So how do you spot this behavior going on? 

[dexX7]

So how do you spot this behavior going on? 

You need to watch the order book very closely.


I'm interested in the following:

When and under what circumstances does selling induce a sell-off? What is the difference to regular market sells? How does it turn the sentiment around?

[MonkeyMarcel]

So how do you spot this behavior going on? 

You need to watch the order book very closely.


I'm interested in the following:

When and under what circumstances does selling induce a sell-off? What is the difference to regular market sells? How does it turn the sentiment around?

Would you say seeing many arbitrary small bids to buy and sell is a sign of manipulation. e.g. on ActM seeing many bids for <100 shares?

[BitHub]

In this very high emotional game with many types of very sick, demented animals in this marketplace, its quite easy.

[dexX7]

for sure you can see bots right now especially on labcoin

What are they doing?

[Anotheranonlol]

for sure you can see bots right now especially on labcoin

What are they doing?

place ask for qty higher than 30 and refresh

[Vandroiy]

Calling weird order placement "market manipulation" is very questionable. If actors trade in an insane way, it's the market's job to take their purchasing power and use it in a more intelligent fashion.

I thank analysts who stabilize markets against nonsense. They win in a fair manner and deserve the returns. Influential orders are not fake orders; any large player who believes them a bad move can take them as long as they exist.

Arbitrarily calling foul play is just being a bad loser. Spreading false information, that is market manipulation and should be punished just like other lies and fraud. But that is not at all the same as reverse-engineering bots or people who cause unnecessary volatility and reduce market efficiency.

[Anotheranonlol]

Calling weird order placement "market manipulation" is very questionable. If actors trade in an insane way, it's the market's job to take their purchasing power and use it in a more intelligent fashion.

I thank analysts who stabilize markets against nonsense. They win in a fair manner and deserve the returns. Influential orders are not fake orders; any large player who believes them a bad move can take them as long as they exist.

Arbitrarily calling foul play is just being a bad loser. Spreading false information, that is market manipulation and should be punished just like other lies and fraud. But that is not at all the same as reverse-engineering bots or people who cause unnecessary volatility and reduce market efficiency.

I'm not talking about weird order placement or coincidences- rather bots programmed with logic to stabilize or drive price in particular directions
it's nice and simple to say it's the markets job to use their purchasing power in a more intelligent fashion...maybe you solved the problem 
anyway I would not call it market manipulation as you can 'manipulate' market with large enough sell or buy, but market making
the last sentence- about reverse engineering people, i don't know exactly what you're trying to write

[zefyr0s]

I thought market making was when someone manually adjusts the price so it reflects a more accurate valuation.

[crumbs]

So how do you spot this behavior going on? 

If it is done well, you don't

[ASICSRUS]

charts and level2s are your best friend!~even BTC has L2 depth! ;Dweeeee