I think this trader panic is new traders who do not know how to do good and right trading so they choose to secure their assets when prices fall and I think that is the most detrimental act of panic because it will lose the assets you have if sold on cheap price.
You have the right point but not only the new investors, the old investors and participants in this market very early, they are also very often panic when the volatility of this market is terrible, although they are always psychologically prepared and ready for such situations but panic is still inevitable. However, at least the frequency of panic and vibration is less than new investors, and I really feel the panic of the trader is necessary, it is like a training exercise, this helps the trader's psychology to become stronger over time, mistakes and injuries will always be a tonic for growth in future