Quoted from Zablon:While the premise sounds good, this isn't even realistic. Most people who 'did nothing' wouldn't even notice this assuming it goes back up to what it was. They would be contributing money on a normal schedule, not on a single day that goes up. That is the equivalent of trying to time the market. In most cases they are missing those days.
In reality, the market dropped 12%, then went up 5%. Making 3-5% in a day is nothing if you lost 12% the day before - and then it goes down another 10% after. (again in the article it's talking about buying during a spike - which most people wouldn't even be able to do. It was a 1 day bounce). My take is, the market is going lower. At this point it's anyones guess. Maybe I'm wrong, maybe I'm not.
It probably will go back down, but I will all but guarantee the market will be up in ten years.
Buy when it dips then ride it when it goes up.