People who are weak hearted and gets depressed easily cannot be helped once the price sees a slump. If they cannot stay strong and keep patience during situations like these then it is very likely for them to fall for FUDs and lose all their money by making stupid decisions. So, it is very important to self analyze what the next step should be when the market faces a dump.
That is a good observation. People know if they want to make money on this market they have go buy when 'blood is running down the streets' and sell when we had a period of double digit green. But as you pointed out there is discipline and strength required to do that and most people are simply to weak for that.