Are stock market bear rallies actually fake, created artificially by market makers to attract individuals?

Question

I mean if you have enough money, you can make the market look like anything you want right?

Answer 1

No.  As a former market maker, take my word on this.

Buyers cause prices to rise.  If a Market maker is a buyer, then he assumes the risk that sellers will ultimately overwhelm his position, especially in a declining market.  MMs are more likely flat or short on a falling market.

Answer 2

I am not a market maker, but I used to work as a sell-side trader. When a huge order comes in to buy or sell x number of shares at a certain price, traders can do some tricks to move the market to get as much of the shares, as close to their price, at times, even better.

Stocks are easier to manipulate, more so the ones that have very little volume traded each day.

Also, market makers earn from the spread between the buy and sell price. It is to their advantage to move prices and hunt for stops from one end to the other. This only works when the markets are quiet, and very little volume trading going on.

- jim http://jsforex.blogspot.com

Answer 3

Market Makers and Specialists. It is in their best interest to create opportunities for them to make the spread. Without volume and liquidity the amount of money they can make is hampered. Also, a bear market rally is used to get their clients out of positions a better prices while at the same time creating the volume for the market maker to make good money on the spread.

Market makers can create the rally by inflating the option prices "foretelling" a rally and then deflating the options as soon as they dump what they want to dump at higher prices.

It's a game. This is only the tip of the iceberg.

The Matrix run even deeper....