Spoofing
Spoofing – so what is it? Its placing a bunch of (say) sell orders a little above market and a smaller buy order a little below market.
What then happens is that “front running computers” see the multitude of sell orders and assume they are real. They then decide to sell some to get in front of some real selling. The real buy order gets executed.
Now our spoofer is long. They will want to sell at some stage – so they reverse the process. They place a lot of buy orders a little below market and a smaller sell order they want executed – and the front running computer crosses the spread.
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