Friday, October 10, 2014

It's Probably Nothing: The Amplitude of the Swings Appears to Be Increasing

Down 334.97 on the DJIA yesterday I was really hoping for a 16666.66 close but we overshot by 7 points.
Maybe at 6666.66. (kidding)
Here's what the daily swings have been over the past month, white up/blue down:

Chart forDow Jones Industrial Average (^DJI)
And what can happen to a system where the oscillations continue to increase in amplitude:


Technically this is an example of self-excitation rather than what the textbooks
mistakenly refer to as forced resonance.