Am very honored to be part of this week's lectures and also thanks to professor @reddileep for the privilege
in going through a research as this.

1) Define the concept of Market Making in your own words.

Before defining the concept of market making one need to understand what ask price, bid price and ask-bid spread is.

Ask price is the price that the market bidders ask which also seller are ready to accept for a cryptocurrency while bid price is that price( highest price) that a buyer is ready to pay for a cryptocurrency.

Bid- ask spread also known as the spread means the price the buyer wants to buy a cryptocurrency and the price the seller wants to sell a cryptocurrency that is the interaction of the buyer and seller to buy and sell a cryptocurrency.
Going into the concept of market making we have the market maket makers.

A market maket maker is one that buys and sells cryptocurrencies in order to satisfy the market, in order to do this, the market maker fills the gap between the ask price and bid price and the market by making sure that market is liquid.

How, making sure that buyers and sellers are able and willing to buy and sell cryptocurrencies at stable prices.

The main aim of market makers is to make profit. For example a market market maker bought 20 pieces of litecoin at $50. When he wants to sell, he will sell the 20 pieces of litecoin at $70 in order to make profit.

2) Explain the psychology behind Market Maker. (Screenshot Required).

In the concept of market making, market makers are in charge of the establishment of limit orders (order to buy and sell cryptocurrencies at a specific price) in the market.

They ensure that the buying and selling order of cryptocurrencies for blockchain follows the order of liquidity in the market. When one places an order in the market, the market maker ensures that there is a limit order for the buying (buy order) and selling(sell order) of cryptocurrencies.

Market makers determine the rate at which they buy and sell cryptocurrencies. When there are many market makers there will be an increase in sell order in that market maker will decide the rate at which they will buy(the buy order) and sell( the sell order) cryptocurrencies and also maintain limit order in the market.

3) Explain the benefits of the Market Maker Concept?.

a) Market makers reduce the bid-ask spreads by ensuring that there are open orders to buy and sell cryptocurrencies at all times, . beingBeing the gap that bridges the bid and ask price its duty is to make sure that the both( bid and ask price) satisfy the market in order to do that maket maker will ensure that the market is liquid and there is availability of buying and selling of cryptocurrencies.

b) Market makers provide trading services for people that want to invest in cryptocurrency and increase liquidity in the market thereby increasing their profit. When there are trading services it creates an avenue for investors to invest more and for easy access of buying and selling of cryptocurrencies.

c) It makes it easy for a market maker to trade without stopping that is a market maket maker can trade even when it is not trading hours, in that a market maker can enter and exit a trade at any time the market maker wants.

4 Explain the disadvantages of the Market Maker Concept?

The disadvantages of the market maker concept are as follows:

a) An appropriate increase in the price when selling cryptocurrency can lead to de- value in market integrity in pursuit to make profits by the market maker.

For example a market maket maker bought(buy order) bitcoin of 130 pieces at $200 when selling it(sell order) will increase it to $400 at 130 thereby making the sell order unfavorable and illiquid to individuals and investors who would like to buy the cryptocurrency.

b)With the aim of making profit by the market maket maker, the market maket maker will withhold information that will benefit investors and individuals thereby leading to unfair profits that is making profit to themselves only not minding whether the investors makes profit or not and also leads to conflict in interest among the make makers.

5 Explain any two indicators that are used in the Market Maker Concept and explore them through charts. (Screenshot Required).**

MOVING AVERAGES INDICATOR(EXPONENTIAL MOVING AVERAGE)
Moving average being one of the technical analysis indicators that is used to determine trends and confirm reversal.

When the price is above the moving average it is considered to be uptrend and when it is below the moving average it is considered to be downtrend.

The breaking of the reversal line simplifies a trend reversal and to know the areas of support and resistance level Indicator.

The market maket maker will check to see whether the price is going towards the moving average and see whether it will bounce back from it or break it as with regular support or resistance level.

The market maket maker uses golden cross(two lines of the moving averages that cross each other) to determine the price action movement.

The market makers uses the exponential moving average Indicator to determine the movement of prices by contriving the direction of price movement of an indicator in a chart and taking advantage of traders to trade in line to the manipulation of price done by them.

The screenshot above shows the exponential moving averages indicator of ETH. The circle indicates the contrivance created by the market maket makers the traders to sell their cryptocurrencies and for them to buy their cryptocurrencies in bulk causing the trend to go up.

The EMA has two indicators the long EMA and the short EMA, when the short EMA moves across the long EMA it shows the golden cross signal at that point that market maket maker will buy cryptocurrencies and when the long EMA moves across the short EMA the market market maker will sell cryptocurrencies at low rates.

RSI(Relative Strength Index) INDICATOR
The relative strength index (RSI) is one of the technical indicators used to measure the velocity and the magnitude of movement of price.

This indicator is used to determine the historical strength and weakness of currencies based on the closing price of recent trades. In RSI we have overbought and oversold.

The overbought region is the region where price of a cryptocurrency trend high in recent price range while oversold region is the region where price of a cryptocurrency trend low in recent price range.

From the screenshot above is the chart of ETH that shows the RSI indicator and how the market maket maker influence the chart at the overbought region causing traders to buy their stocks and as a result of buying their stock the price will go down ( downtrend).

On the chart we have two points, point 70 and point 30 when the RSI is at point 70 and above. From the chart it shows that it is overbought and when it is at point 30 and below it shows that it is oversold, from the chart we have the oversold and overbought. The arrow up indicates over brought while the arrow down indicates oversold.

Conclusion

The liquidity of the market is determined by the market maker marker but with the help of these indicators traders can know when the market is favorable or not.

A trader needs to have a full understanding of the benefit and demerit of a market maker.

Thanks to @reddileep