Thursday, July 12, 2012

Proposed Reason for Inversion of Correlation between Astro-Indicators and Financial Markets

Celestial mechanics are the reason for the flip of correlation between astro-indicators (Bradley Index and the like, but also ‘space weather’-data like sunspots, solar flux, geomagnetic indices) and financial markets. The inversion of polarity oftentimes occurs in a time-window of +/- 2 weeks around the equinoxes and solstices.

When the Sun periodically experiences significant increase in sunspots and solar flare activity, flares release energy in many forms, including electromagnetic energy and energetic particles such as protons and electrons. When this energy reaches the Earth, it interacts with the Earth’s magnetic field. This generates an electric current that flows through the Earth’s surface and affects electric power, satellite communication, oil pipelines and of course human brains, mood and actions.

Three mechanisms were proposed to explain the seasonal variation of geomagnetic activity:
  1. The axial hypothesis established the fact that the geomagnetic variation was associated with changes of the Earth heliographic latitude. This indicates that the Earth would be favourable connected to the solar wind from the active solar regions resulting in an increase in geomagnetic disturbance.
  2. The second is the equinoctial hypothesis. It focuses on the angle when the dipole is perpendicular to the solar wind flow, increase in geomagnetic activity will occur around the equinoxes, and minima around the solstices.
  3. A third approach assumes that the Interplanetary Magnetic Field lies in its typical parker spiral configuration on solar equatorial plane, the southward component of the interplanetary magnetic field in the geocentric solar magnetospheric (GSM) coordinate system is increased when the angle between the z axis of GSM coordinate and the solar equatorial plane is minimum near the equinoxes. The southward component of interplanetary magnetic field is maximum in early April and October.


[ find more correlation charts with inversion examples HEREHERE + HERE + HERE ]

Al Larson - Astrophysics & Chaos [March 20, 2001]