The near 1000-point drop in the Dow intra-day followed by a 700-point rally must be a record in the history of Wall Street. It is reported that an institutional trader made a mistake by entering to sell 6 billion shares instead of 6 million shares. When participants in the stock market saw the huge volume up for sale, they panicked and sold at the market. This caused the Dow to plummet, and within 6 minutes, it had dropped 700 points. At the end of the day, it was down 347 points.
The debt crisis in Europe is the greatest concern presently. Greece is leading the way. Others in trouble are Portugal, Ireland, Italy and Spain. If the debt disease spread like the H1N1, the amount of damage to the stock market can be enormous. But markets always come back stronger after panic sales. This does not mean you should go in and buy what is offered. I think it's better to wait and see. If you are a chart reader, you should wait for two consecutive good candles before you buy. This may not always be correct. But odds are definitely in favor if you wait for an excellent opportunity before you take any action.
When in doubt stay out.