Thomas Dixon, 25 May 2021
“The market is manipulated by big sharks.”
“The price isn’t moving when it should be.”
And a lot more. That’s how people on the internet speak about stock manipulation or market manipulation. But, what is it, really?
What is manipulation?
Psychologically speaking, manipulation is a form of social control that uses indirect, misleading, or underhanded techniques to alter the behavior or opinion of others. Such tactics could be called exploitative and devious since they further the manipulator’s objectives at the cost of others.
Manipulation is not just done mentally. In fact, there are a couple of instances right now where you can see manipulation. People on the internet speculate that the stock market is being manipulated by other investors or traders. The same goes for the crypto market. While we don’t have concrete information to support that, we do have a couple of information that discusses if it really exists and how the market is manipulated.
Does market manipulation exist?
In February 2021, the law firm Hagens Berman launched a class-action complaint charging market manipulation against one of the primary instigators on the Reddit list.
Three forms of market abuse are prohibited by the Securities Act of 1934 and the Commodities Exchange Act: spreading false information, speculative trading, and manipulating prices.
So, if you’re wondering whether market manipulation exists, yes is the answer and it’s done in three ways according to this security act.