Technical view by Nooresh

Circular Trading ,Manipulation Market-Making — Stock Markets !!! Not so Clean :)

Lets first get into the text book definitions of the above Terms.

A fraudulent trading scheme where sell orders are entered by a broker who knows that offsetting buy orders, the same number of shares at the same time and at the same price, either have been or will be entered.These trades do not represent a real change in the beneficial ownership of the security.


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.


A broker-dealer firm that accepts the risk of holding a certain number of shares of a particular security in order to facilitate trading in that security. Each market maker competes for customer order flow by displaying buy and sell quotations for a guaranteed number of shares. Once an order is received, the market maker immediately sells from its own inventory or seeks an offsetting order. This process takes place in mere seconds.

The Nasdaq is the prime example of an operation of market makers. There are more than 500 member firms that act as Nasdaq market makers, keeping the financial markets running efficiently because they are willing to quote both bid and offer prices for an asset.

Although from all possible sources on the net there is no formal definition for OPERATORS :). But yes they are needed :)

In the posts after this we would be looking into some of the charts where one might need the above definitions.

Best Regards,



Article by Nooresh Merani

Nooresh has written 2531 articles.

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