I suspect this was just one or more discord/telegram pump&dump groups. They have been popular in the crypto-world for ages.

It's a members only group, where a leader will pick a stock that the whole group will buy. Then at an agreed time, the whole group will hype the stock on (slightly more) public social media. If they hype it correctly, everyone sells at a profit after a fixed hold period.

These groups might have a secret (or semi-secret) inner circle who get to see the decision before the main group. These people are able to profit from the main group even if the pump phase fails.

It's possible the SEC has infiltrated one (or more) of these groups. Or they are are simply looking for trading patterns in dead penny stocks.

There are plenty people who invest in pump&dump schemes fully knowing that it's a pump and dump. Because it's still possible to profit if you can predict the length of the pump and sell before the main dump.

There are a few strategies that might be in play: sentiment analysis and technical analysis. Sentiment analysis does what you describe. Technical analysis is similar, but only looks at price movement and attempts to either follow or buck the trend. In these examples, a social media post could push the stock from $0.0001 to $0.0002. Maybe a sentiment algorithm sees the positive post and a technical analysis algorithm sees the positive price actions and confirms the upward momentum, triggering a purchase that moves the price to $0.0003. That 300% gain gets noticed by others and so on.

Algorithms are really just a digital manifestation of group psychology. The same thing happens in a run on a bank, or a Tulip bubble. Word spreads and others follow.

The Spiffing Britt on YouTube apparently has a bot that watches for anything musk tweets, buys some of it, then sells it again an hour or so