Market Manipulation

Posted by Markco at 9:00 AM

Hi guys, today's Guest Post is brought to you by Bozzor, the Gold Multimillionaire all the way from Romania!

Prices.

They go up and down, up and down...but why?Most of the times because the demand and offer are also going up and down.

The vast majority of items available in AH are raw materials and craftables.Most of the times, craftable item prices are speculative while raw material prices are generally based on offer and demand.

Almost nobody will sell a crafted item under material cost.There are exceptions, ofc, but those are... exceptions, and not the rule.

All traders wants one thing only : to buy as cheap and sell as expensive as posible.But how to be sure that what they buy is as cheap as possible? Well, there are two choices : wait until the prices go down as much as possible (reaction) or make the prices as low as possible (action).

Since craflable item prices are largely speculative, traders usually undercut each other until they reach their minimum profit mark.Once that mark is reached, they stop posting.Now, they have different profit marks, and the ones that bought the cheapest raw materials sell first.And if they manage to sell their stuff before the demand stops...all other traders (well, most of them) will get a mail filled with expired auctions.

So, buying is much more important than selling.And buying as cheap as possible is the key for large profits.Back to reaction and action.Most of the traders are reacting, waiting for a natural price drop of raw materials.Few traders act, forcing artificially the prices to drop...or go high, depending on what they actually wants.

What they do is Market Manipulation.

Now, to successfully manipulate a market, one need to know his server economy very good : how many farmers are active, how much they sell on daily basis, how many big buyers are for that market.

If you didn't know by now (but i think you know), ore market is the most active market in game.From ores we have : raw gems, cuted gems, bars, enchanting materials, items that requires gems or bars to craft.

The next active market is herb market.From herbs we have : flasks, potions, glyphs, inks, dust of disappearance.Herbs are also used in gem transmutes.

Leather market is aslo very active...not as much as herbs, but certainly more profitable (LW leg enchants mostly).

After this very short coverage of raw materials, lets see how can we manipulate a market to reach our goals.

What we need to do, its easy : post large quantities of raw materials at certain prices, to force farmers post cheaper than us, starting a undercuting chain reaction on that market.What is hard is to know the price we will post for and how much we will post...

Well, if you know your server farmers, the answer is easy : post in stacks of 1 (ore, herb, leather,cloth) and below medium price (but not to much under) and post before farmers are posting.They will undercut the cheapest price in AH, no matter if its per stack or per ore.

If you think that someone will buy what you posted and will repost at higher price or just buy because its cheap for them...worry not.Most people REACT, so they will wait for a better price, because you already flooded the AH and anyone will know that a large offer will make prices go lower.

Now, the hard part comes when farmers start to sell...They will undercut you, and they will post in stacks of 20 providing large quantities of materials at prices closer and closer to what you want. Now, what if someone else buys before you do?Well, if you know the main sellers, you should already know when are they online, so you can buy before they do.

Ok, the above it is for lowering prices.But sometimes (well, most of the times for a serious trader) you want a certain price to go up, limiting the competition to have cheaper materials.This also can be done, and most of the times, shortly after you droped the price.

The cycle is like this : you post materials to force prices go down, farmers come and post cheaper, you buy their stuff, than you cancel your auctions and repost for high price, but this time in stacks of 20.The window of opportunity is generally small in weekends (1-2 hours max) and generally big on weekdays (up to 4-5 hours).

What you really want with this market manipulation is to craft items as cheap as possible, with a high profit mark, so you can sell them at profit EVEN if the price for raw materials is HIGHER than your crafted item. If you managed to buy, lets say, elementium ores for 30g / stack and crafted bars for 3g each, then you forced a price increase to 40g / stack...everyone who buy at 40g will not sell elementium bars under 4g each. But you can.And you will make profit by selling UNDER the current material price.

I hope you understand that Market Manipulation is not for everyone, but only for those who have great knowledge of their server economy.If you are not one of them...what you waiting for ? Add on your friends list the main farmers and buyers, watch their activity for couple weeks and then, start making more gold than you did before.

Acting is better then reacting. So...start acting.

Bozzor,
Gold Multimillionaire.

http://www.auctionhousegoldstrategies.wordpress.com