Market Spoofing is done when a trader tries to deceive the market by entering very big buy sell limit orders and cancelling them before they can get executed. The most famous case of market spoofing is the 2010 Flash Crash in which Dow Jones, S&P 500 and the NASDAQ Index collapsed and recovered within minutes. This caused trillions of dollars of loss. A UK home based trader Navinder Singh Saro was using a trading robot that would open big buy sell limit orders just above or below the recent high and low. This big buy sell order would cause the market participants to modify their orders causing price to go in the direction in which the spoofer wanted . At this point, he would cancel the limit order and profit from the price going in his direction. This practice is now forbidden by law and illegal. You can read this post that explains what is market spoofing and how to catch a spoofer.
