When a project in which you are investing for short term gains is dumping a lot it would be logical to convert it into cash . In the unlikely event that you are not able to convert into cash or you wanna keep the money in the crypto then yes opt for some stable coin and then invest back when market hits bottom.
After this big dump happened I personally tried to cash out with minimum loss and reinvested in some profitable cryptos and stocks with great potential.
10 days passed - I'm 20% up in profit so yeah, consider reinvesting