(Editor's Note: This article was originally published on Real Money on Oct. 16, 2:00 p.m.)

The oil market is in free fall. The stock market is in free fall. You're taking losses, big losses, in stocks that you bought -- not at the top of the market where valuations were high -- but at areas you thought were terrific long-term propositions. What do you do now?

I am precisely where you are right now, because I am an oil trader, first and foremost. And I can't tell you what is going to be right for you, I can only tell you what is right for me. And right now, I'm standing pat and even committing a little more capital into these markets. I'll tell you why: panic.

Panic is clearly what has inspired the last several big drops in the oil market and with stocks. I saw Professor Shiller of Yale University on CNBC comparing this selloff with 2008 and 2000. Really? Are price-to-earnings ratios in the 40s? Is there a structural credit market problem about to explode? If there is, I've missed it. Nothing fundamental has changed. Instead, there are only rumors and speculation about what is the new reality on oil. Let's look at some of them.

One is the perception that OPEC is coming apart and the Saudis are engaged in a war for market share with the rest of the Cartel and the shale producers here in the U.S. A letter from Saudi prince al-Waleed bin Talal has warned of the dangers of $80 oil and squelched the idea that this is a new Saudi policy.

What I believe has happened is that the Saudis have worked to retain market share first before even considering unilateral, or Cartel-wide ceiling cuts. They've learned that jumping the gun on production adjustments doesn't help them or the markets. The useless increases in 2005 and 2010 are proof of that. The OPEC meeting in late November will certainly be interesting.

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But $80 oil is not sustainable. Harold Hamm, CEO of Continental Resources  (CLR - Get Report) , was interviewed on Bloomberg TV and said that $75 oil would require "adjustments." You bet it would. Even with the strong capital position of Continental, capital expenditures for 2015 would need to be slashed -- and there are multiple players in the Bakken with far fewer strong positions than Continental. Weak players would ultimately drop production, ending the glut that seems to be so worrying the market today (although there's been a structural glut in oil for the last year).

Volatility is built on emotion and that's what's driving the action today. Can oil go down to $75 or $70? Sure, but it can't stay there. I believe this market is more concerned with the outbreak of Ebola in Texas than the oil glut. It's just a moment when everyone's nervous and raising capital. Look at the bond rally if you don't believe that.

But I bought Cimarex Energy (XEC - Get Report) at $115, not at $145; Anadarko Petroleum (APC) at $89, not $115; and oil at $89, not $105. So, I'm not ready to throw in the towel on this trade yet.

Now, there isn't an analyst anywhere who doesn't think prices will go down another $10 first. Where these guys were at $105, I don't know, but they're all convinced of it now. They could all be right, but every bone in my body tells me that this is a panic move that needs to be bought.

And if I'm wrong, I'm wrong.

I can't tell you what to do, but that's what I'm going to do. Good luck.

At the time of publication, Dicker had positions in XEC and APC, but positions can change at any time.

Dan Dicker has been a floor trader at the New York Mercantile Exchange with more than 25 years of oil trading experience. He is a licensed commodities trade adviser.

Dan is currently President of MercBloc LLC, a wealth management firm and is the author of "Oil's Endless Bid," published in March of 2011 by John Wiley and Sons.

Dan Dicker has appeared as an energy analyst since 2002 with all the major financial news networks. He has lent his expertise in hundreds of live radio and television broadcasts on CNBC, Bloomberg US and UK and CNNfn.

Dan obtained a bachelor of arts degree from the State University of New York at Stony Brook in 1982.