Head and Shoulders
I mentioned to John Walker that the pseudorandom data generated as a clone to the EGG database by an algorithm he wrote is invaluable as a source of "control" data to check our analyses. In particular, the cumulative variance figures do not lend themselves to ordinary statistical assessments, but visual comparisons of the real and pseudo data provide some indication of how likely the variance behavior is. He sent the following response.
> I have put several of the most striking and informative > figures on a dedicated webpage linked from the GCP home > page: Analysis > of ... September 11, 2001. The algorithmic > pseudorandom data are invaluable for persuading me that the > remarkable analytical results are not in error. Yes--I have been following the results and they are stunning. I've directed several people who've contacted me to the results page and even the most skeptical have been taken somewhat aback. Once again, there's that remarkable "leading indicator" effect, particularly notable in terror10-12vp.gif, which is hard to reconcile with any conventional presumption of causality. About 20 years ago I was very interested in modeling the behaviour of financial markets, in particular, the way they "anticipate" or "discount" events--that is, move in advance of the news. There are, of course, perfectly mundane explanations for many such events (viz. the current investigation of suspect trading in advance of the terror attacks), but there are other cases where it just seems like the collective consciousness of the market is picking something up in advance. In fact, one might say that the global financial markets were the first consciousness supercollider. As an aside, the pattern of the real data in the terror10-12vp plot would instantly be recognised by a stock market chartist--"ink-stained wretch"--as a "head and shoulders". Note that the "break-out" above the peak of the left shoulder is well in advance of the event and forecasts a run-up of at least the size of the left shoulder--right out of the 1954 edition of Edwards & Magee!