Spoofing

Spoofing is a form of market manipulation where traders place large orders to create a false impression of market demand or supply. These orders aren't meant to be executed; instead, they are placed with the intent to influence other market participants’ decisions. Once the market reacts to these misleading orders, the spoofer cancels them and executes trades in the opposite direction, profiting from the price movements caused by the false order flow. Spoofing is illegal under various regulations, including the Dodd-Frank Act in the US.