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what does to swing from exuberance ... refer to in the following sentence? Is it an explanation or a definition for to overreact? (emphasis added)

As we are learning from a growing volume of research in the field of behavioural finance, money amplifies our tendency to overreact, to swing from exuberance when things are going well to deep depression when they go wrong.

the ascent of money, by Nial Ferguson (2008), p 13.

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Think of a pendulum, it swings from side to side; the trajectory is from extreme left to extreme right. The analogy here is to swing between two extremes of mood, from a very positive mood (exuberance) to a very negative mood (deep depression).

Here the author is saying that both these extremes are an over-reaction to the situation. A positive situation should make us feel somewhat positive, rather than extremely exuberant, similar a negative situation should not make us deeply depressed.

Underlying this idea, the metaphor of the pendulum implies that moving far the right (extremely positive) will inevitably, as the pendulum swings, cause us to move farther to the left (extremely negative) when the situation changes.

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