this is probably the most complex aspect of crypto trading, and it's more a question of how whales manipulate not just dogecoin, but every coin, including bitcoin.
also, it's not clear to what extent bitcoin prices are genuinely or artificially tracking with the altcoins, and how that's done.
the claim is "it's just demand driven", which explains why one exchange will be slightly ahead of behind another, for the same coin(s), but demand doesn't explain why there's so little difference in pricing.
i'm betting exchanges are communicating via APIs, and so are market makers, so they can remain in sync.
it's also not clear (to me) how market makers generate liquidity, showing up with enough size on the bid/ask to fill orders of all sizes.
perhaps others here can fill in those blanks. but my guess is this area is full of guarded secrets.
retail traders can use bots that go short or long. perhaps market makers run simiilar algos, but on a much larger scale.
one thing that's always frustrated me about crypto vs OTC (and to some extent big board) trading is how quickly algorithms can pull the price back down after a "material event" like, for example, an elon tweet. it's not normal for the price to move up 30% on big volume, only to be pushed right back down into a tightly-controlled, precalculated range, but that's what we've seen with doge many times.
i noticed abag's reply to you, where he said whales can and do trade large blocks of coins between them to manipulate price. i'm sure that happens often enough.
i've read articles about bitcoin trading groups. one strategy of theirs is to buy put options (a bet bitcoin will drop), many contracts at very high leverage, then they'll dump bitcoin suddenly, or have another group dump it, to realize massive gains on their options.
crypto is the wild west. there may be some exchanges retail knows nothing about. i've noticed many times doge will move up sharply and none of the exchanges i follow register that volume. so is it coming from some boutique exchange that only whales can use? perhaps.
we could chat about this for months and never scratch the surface.
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