10 Red Flags for MMM (Market Maker Manipulation)
I have observed since I have been trading:
Cross-Trading - is the control by one or only a few brokers who match purchases and sales to drive up or down the stock price which ever way benefits them. According to Forbes' 07/29/96 Article on Market Makers this is the hallmark of stock manipulation …
Note: Illegal Short Sellers get upset with this and call it matched trades... they hat the word Cross trading.
Boxing - where a broker will position himself on both the ask and the bid, which is ALSO the heart of stock manipulation according to Business Week's 1996 Article: The Mob on Wallstreet eliminating competing market makers and allowing only cooperating brokers to bid on stocks, the result is a kind of rigged auction.
Stock Call Signals - which appear to be small share blocks of stock typically 100, 200 and 300 to get a supply of stock another MM or broker to help with an "Oversell", which is the amount of shares sold by a Market Maker that were not bought. Market Makers buy on the bid and selling on the ask, which is an automatic buy low sell high advantage for them same as being the house in a casino. However, if they get to much interest to their agenda they begin using some if not all of the other nine tactics to kill interest, and liquidity.
Locking - is when the MM on the ask moves to the bid in an attempt to back the bidding MM off to drive the price of the stock down. Thus by attacking the bid, both the bid and the ask are the same price. Sometimes a stock will stay locked for sometime if the bidding Market Maker does not move off the bid wanting more stock. Then the short delivers rapid fire of trades Painting or Rolling the tape scenarios.
Nothing Done / No Fills - No ECN in place then getting filled is by phone and thus this is applied to your order and market makers trade ahead of you or flat out wont fill no matter what regardless of complaints, but if persistent will eventually get a fill. Of course the Manning rule allows this.
Buy orders at the Ask Filled on the bid, which is used to show weakness in the trading thus an investor's buy is shown as an investor sell ... this was disclosed at one time in the MMs reports to the regulators but was shut down once the MMs reports were proof of what they were doing.
Excessive spreads between bid and ask prices; which can be as much as $3.00 bid and $6.00 ask ... This occurs to shut down interest and keep it away. ECNs will take care of this little manipulation
Oversell grows daily, which is where the market makers sell more stock than they have bought. Further some or all these tactics are impoosed.
The Churn - is market makers trading where most of the volume (59% according to Forbes' 07/29/96 Article on Market Makers) is among themselves. Thus by painting the tape they can effectively change teh Technical analysis and stimulate whatever fear they want to get capitulation.
FUDs are posters (Usually anonymous posters) posting deliberate false and misleading rumors (rumor-mongering) in an attempt to deflate the stock price by instilling Fear, Uncertainty, & Doubt. (Could these be Market Maker or short voices) and of course attack with the same nonsense and love to name call, and personally attack.)
Easy to spot FUD they spin facts and love claim the law does not allow something and thus it can never happen.
But it does ...
p2bAAAT & DSAS |
