What is advancing the bid?

According to MAR's Commission Delegated Regulation (EU) 2016/522 of 17/Dec/2015, advancing the bid is the practice of entering orders to trade which increase the bid for a financial instrument, in order to increase its price.

Analogously, we can say that depressing the ask is the practice of entering orders to trade which decrease the ask for a financial instrument, in order to decrease its price.

I guess that, similarly to most of the other forms of market manipulation, the key issue is whether there was an intent to defraud the market - i.e., advancing the bid and depressing the ask are forms of market manipulation if they are done without relation to genuine market demand or the worth of the securities, and therefore having solely the goal of altering the market price.

Example:

From my understanding, the various forms of market manipulation are not entirely mutually exclusive, as it is evident in the case of advancing the bid. Indeed, while advancing the bid is a manipulative practice that can be done by itself (when a manipulator advances the bid and takes no further action), it also can be an integral part of other forms of market manipulation, such as spoofing or wash trading. For example, a spoofer may advance the bid to lure other investors to place bids at that same price or at similar prices, to then remove its bid and immediately later sell at that new more favorable price. Likewise, a wash trader can advance the bid and then place a sell market order to trade against itself, therefore increasing the trading price.

When advacing the bid is done by itself, it can be done with or without execution. Indeed, the final goal of increasing the bid prices and/or the traded prices can be achieved in both scenarios, by: i) luring other investors into placing bids at that same price or at similar prices; or ii) being executed against a sell market order (note that making some purchases at unfavorable prices may be worth it for the manipulator, for example when he/she holds a large position in such securities).

Advancing the bid (when done by itself) is more feasible in a market where there is low volume, low market depth and wide bid-ask spreads, since, in such conditions, increasing the best bid will likely have stronger and more lasting effects. It is true that one can also advance the bid in a highly liquid security... However, the effects of such action will likely be very temporary, if they are material at all.