The hits just keep coming for the market. Another day, another drop for the Dow. Wow. Tuesday’s 508 point debacle left the index standing at 9,447. In case you’re counting, that makes it five days in a row the market has ended lower. To make matters worse, the Dow tested Monday’s lows and wound up finishing below that level. Remember what I’ve said about higher highs and lower lows? These trends are easy to identify and right now we’re in the midst of a full blown sell-off.

Read somewhere retirement accounts have taken a $2 trillion loss over the past year or so. I just find that amazing. Already I hear chatter of people working longer and putting off retirement because of what the market has done to their retirement accounts.

I know things look bleak right now but trust me, the storm will pass and the market will recover. Of course, the rule book is changing and there will be new players in the market and they we will be the ones to watch and follow. But for now, let the market do its damage and let’s keep looking for opportunities to go both long and short.

I’m not making any predictions on how low the Dow can go because on any given day we could get some kind of “miracle news” that takes the Dow higher by 1,000 points but from my study of the chart for the Dow, it looks like we could test 8,300. That’s another 1,000 points lower. From there it gets real ugly.

In the meantime, I’m serious when I say this. I love the market drop. Everybody thinks nobody is making money, but the ones shorting this market and playing the bounces are making a mint. This morning before the market opened I mentioned how we have been using the PowerShares QQQ Trust (QQQQ, $32.65, down $2.21) to short the market. The October 45 puts (QQQVS, $12.20, up $1.85) were at $3.00 on September 10 and were up another 18% today.

You could feel the “chill in the air” when the market opened and when Bernanake spoke, it just got worse. Want better results than 18% in a day? Check this out.

The October 32 puts (QAVVF, $1.40, up $0.62) saw incredible volume today. I’m talking jaw-dropping. The puts OPENED at $0.64 this morning but you could feel them going higher. I can’t explain iust how great of a tool this one strategy is. It feels good when everyone is running for the hills and you’re in there buying put options. There were nearly 150,000 contracts traded…nearly 3x the open interest. 150,000 for one strike price. Unreal.

Let’s just put it this way. If you had an extra $650 this morning and decided to buy these put options in hopes of the market tanking again, then you would have had $1,400 by the end of the day. That’s $750 in six-an-a-half hours! Times that by two. Now you’ve got $1,500 in a day.

And don’t tell me it’s gambling. I’d rather play this game then the ones in Vegas. Wall Street has better odds right now, thank you. Look, there will be a day when the market is going to give you a clue and you are going to feel like a 500-point rally is in the cards. When you do, go long the quad Q’s for a day.

That’s the difference between a novice investor and a “savvy” one.

Rick Rouse