Note: In SPOT trading, you can never lose your coin, the worth of your coin can only reduce but your coin remains to rise again in worth when the market goes green.
It is true, but if you do not sell your coin and still hold when the price is down. You will have a chance to see your coin price increase someday so you will be back to see the high price for your coin and make a profit. But many traders decide to cut loss their coin when the price is down with the hope that they can buy back at a lower price. I think that will depend on their strategy to be applied in the trading and every trader will have their own strategy to the current situation in the market.
We should always point out that there are specific coins that their price can decrease but holders should not cut loss because the price of the coins will increase back, coins like bitcoin, ethereum, binance coin and some other coin like that, but there are some coins that are shitcoins, their price will decrease and never increase back but dump more, some even later become dead coin. We should know the type of coins we are dealing with, not all coins are good to buy.
This is most newbie mistakes, because they buy and the price dump, they will decide to cut loss which suppose not to be, they cut lose and they lose money, what is funniest most is that some people will cut loss and the price will not decrease further but start to increase, or the coin will just take a little further decrease and start to increase, this happened to me many times when I was a newbie.
Indeed, I see that many of us cut loss the coin by selling at a low price when the price is down. They do not think that the price can increase anytime, so they only think that selling their coin will save them from a big loss because the situations seem to be getting drops too deep. Well, that will depend on how our analysis because as long as that is about the potential coin, I think we can still hold the coin and buyback for more when the price is down.
I think it is how we can manage our emotions related to the current situation at the market and how good we can analyze the price so we do not get the impact from the downtrend. Maybe it will need more experiences to have that control and that is worth learning about that.