If the trade frightens you is probably going to be the profitable one. It's the institutions that control the direction of the indexes and they monitor fear. They know how the small trader functions and what drives him/her and where fears lie. They trade directly against that.
Bottom of a trend everyone is frazzled having lost their shirts (PI's) the big boys buy it up amidst all the bad news (they put out themselves). Conversely at the top of a curve, PIs feeling comfy and buy into the top of the rally, the big boys bail out IN UNISON (yes they talk) and the muppets pick up the tap.
Right now I'm a somewhat agnostic. Everyone is becoming bearish but is there further to go before the institutions decide to actually sell out? There are some signs of economic crumbling but so has there been all the way up since March.
If you don't invest now, you're probably going to miss on some opportunities..... but others will be around the corner. So... there's no harm in getting involved now, but equally if you wait then other 'boats' will turn up that you won't have missed!
If you open up a CFD or spread betting account to do some of your investing, then you could work your capital on the short side also...so it's not impossible for you to make some money in a falling market as well. Whatever you do makes sure to play with some paper money for a while and see how you far.