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If the sudden drop of the All Ord to less than 6000 prompts you to buy more Aussie shares, you assume that prior to the drop that Aussie shares were properly valued. This drop may be an overreaction but it also may be a correction. Unless you know the intrinsic value then you won't know whether to buy or sell.
Also, what happens in America won't necessarily happen in Australia. There is short-term correlation between the two market but they are fundamentally different. E.g. in Australia there is a bias towards resource companies. There are hardly any health or tech companies in the ASX200. Because of this, the dot-com crash didn't hurt the Australian economy as much as it did the American economy.
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