"Price Manipulation: The act of artificially inflating or deflating the price of a security. In most cases, manipulation is illegal. It is much easier to manipulate the share price of smaller companies, such as penny stocks, because they are not as closely watched by analysts as the medium- and large-sized firms.

Now a few things you should know about market makers:

A market maker is not always trading with you and may trade against you creating a conflict of interest

A market maker can use hidden orders to avoid disclosing his real intention and to hide large volumes.

A market maker can use large fake order sizes to intimidate traders to run in the opposite direction. This is referred to as NITBB (no intention to buy bid) and NITSO (no intention to sell offer). For example if a market maker wants to run the stock down he will create a virtual institutional size ask putting fear in the traders that the stock is going down. The market maker will then fill his buys at the lower prices. The reverse may also be done.

A market maker may display a real size to show that liquidity is there to attract big interest

A market maker may use a fake order of a large size to hold the movement until he is done buying or selling his position.

A market maker can use his real identity or can hide behind an ECN (electronic communication network) depending on his intention. He can make an inside market on both sides and under different identities
Market makers may also trade back and forth among themselves, filling their own bids, creating a large decrease and spooking everyone who is uneducated into selling also.

The market maker (specialist) is granted various informational and trade execution advantages and has a lot of power. They can see everything. WHEN YOU ENTER A STOP LOSS ORDER THE MARKET MAKERS CAN SEE THEM! You may notice from time to time a stock hit a short term low and then move up again. Market makers will do everything in their power to hit the stop losses to build up more shares for their account if they believe the stock will rise again. A stop loss order becomes a market order when it is triggered. If the volume of the bids are low your stop loss will trigger a much lower sale price and bring the stock down with it (referred to as slippage).

Watching the trades go through you may sometimes notice very small executions. Some people believe, and remember this is just a theory, those small numbers could be the market maker signals to each other...

100 I need shares.
200 I need shares badly, but do not take the stock down.
300 Take the price down so I can load shares
400 Keep trading it sideways.
500 Gap the stock. This gap can be either up or down, depending on the direction of the 500 signal.

Don't be manipulated by the manipulators! Buy on the dips, don’t get emotional, and pull your stops. If you must use stop losses be very careful. Buckle up and enjoy the ride. If you cannot stomach the ups and downs then buy a savings bond!"

If you see buys of:

100 > I need shares
200 > I need shares badly but dont take it down to get em
300 > Take the price down to get shares....
400 > Trade it sideways based on Supply and Demand
500 > Gap one way or the other, usually to the direction
of the 500 trade. Sometimes -if in the middle -keep the price right where it is
911 > News incoming