1) If you wanted to deliberately manipulate the markets, you'd come up with something less obvious than this. You might even come up with a pattern that is non-periodic or even put a few calls to rand() into your code just to spice things up.
2) If you were doing anything in the markets on purpose, you'd try to be unpredictable. And by "unpredictable", I mean "hard for a human to look at a graph and guess at". Once you trade predictably, the other guy can exploit you.
3) I've come up with trading strategies myself that generate "crop circles" in simulation. It's never on purpose, and I'd certainly never be permitted to put such things into production.
Sometimes algorithms behave in ways you didn't expect. For instance, you might compute a quantity f(t), place a buy order when f(t) > 0.5 and cancel it when f(t) < 0.5. If f(t) oscillates wildly from 0.4995 to 0.5001, you will wind up doing "quote stuffing" yourself. Of course, most of the time f(t) winds up oscillating from 0.631 to 0.632 or something like that, and things work normally.
If your system is designed well, some monitoring system further down the line will prevent this. Not all systems are well designed.