It is likely that investors all over the world were up before dawn this morning.  Most were probably filled with dread, and rightly so.

China’s Shanghai stock exchange was in the middle of the biggest fall in nearly 8 years. Futures for the S&P 500 [stock_quote symbol=”spx” ] were tanking, showing their biggest decrease in over 4 years and markets all over the world were getting crushed.

The New York Stock Exchange warned that it would stop trading if the S&P fell more than 7%, likely scaring investors even more.

Then the market opened. The Dow Jones Index [stock_symbol=”djia”] was down more than 1000 points within minutes.

Many traders experienced the inability to sell a stock for the first times in their lives, with so many market orders and no buyers to fill them. Many online brokers experienced technical issues, losing some day traders hundreds of thousands of dollars.

It was the biggest single day drop in years and people were terrified.

Then came the bounce. All three major indices rallied, nearly going into the positive by midday.

Solar stocks, some down nearly 30% when the market opened, rallied to double digit positives. Apple [stock_quote symbol =”aapl”] fell nearly 12% then rallied nearly 15% to positive territory.

Doomsayers warned of a pending market crash, a broken market, and a dreary future while bullish analysts predicted the greatest bounce in history.

So what is the truth? Should investors be pouring money into the markets expecting a legendary bounce, or putting their money into safer assets such as bonds or gold?

Unfortunately the market has broken its technicals and become wildly unpredictable.  No one really knows where it will go at this point.

We are at the tail end of the longest bull market in history, but flaunting a relatively strong economy with consistent growth and good fundamentals. Analysts are split down the middle on what will happen.

To go long or short in this market is a gamble, not an investment. You may as well head to Vegas.[the_ad id=”501″]

Beginning Stock Trader recommends doing one of two things. If you would like to invest for the long term do some research about diversification.

Keep cash on hand, purchase securities in commodities markets, buy gold, look into real estate and look at emerging markets. If done properly your money will stay safe and continue to grow slowly, but consistently.

The other option is to shrink your perspective and try out day trading. The markets still have some semblance of patterns on hourly and daily charts and you will not wake up to a crash like today’s ever again.

Third option is to go all cash. Wait this out. You don’t have to be making money all the time. Often the most money is made by those that sit and wait patiently for the best opportunities.

Whatever you choose to do, be careful. Remember to never, ever invest more than you can stand to lose.