Especially to those who are still working, I'd remind you that you're not putting "$10,000 in the market at the peak", you're buying each pay period while the market is down. And for those with an itchy trigger finger, you might be interested in this T.Rowe Price Quarterly "TRP Report" magazine (Summer 2006 - page 6 of the [Link .PDF file].)  (Note: I'm not 100% sure you can post links directly into the T.Rowe Price site. You can't do that too well on Vanguard, for example.)  Here are the two key paragraphs:

Bailing Out of Market Declines Can Hurt Long-Term Returns

The firm compared the results for two hypothetical investors. One maintains a diversifi ed equity portfolio comprising 60% large-cap stocks, 20% small-cap stocks, 15% developed international markets, and 5% invested in emerging markets (as represented by various indexes). The other investor, who has a tendency to overreact to sharp market setbacks, sells any of these asset classes after a 10% monthly decline and invests that money in cash. He does not reinvest in that asset  class until it gains 10% in a month.

...while the “in-and-out” investor did considerably worse, earning an 8.0% annualized
return, even though he had no exposure to large-cap stocks during the severe 2000-2002 bear market. In other words, a $100,000 portfolio at the start of the period would have grown to $517,499 for the steady investor, or 43% more than the $360,659 for the in-and-out investor. Of course, past performance cannot guarantee future results.

As Bob asked (in the REA context) recently, "Are you in it for the long-term or the short-term?"

Tim