People are greedy.
I also experienced this once, because my mindset is that if I won a trade using my technical analysis, I can win the next trade that I'm going to make with a higher leverage for an easy profit, but it's not as simple as that, because trading is not always Christmas. We always forgot the risk management and the right management of our funds and profit, that's why we always lose everything and the rage trading will start.
Chasing the losses is the most case scenario for newbie traders, trading randomly because of their frustration hoping to make profits without any plan at all.
Yeah that is definitely not an easy thing to do and I understand the logic and I understand why it looks so difficult for a lot of people. I am not saying that you shouldn't do it, all I am saying is that if you really want to do it at least be aware that you could lose all your money if you do it, that would be the most logical thing. I know that we are going to want to do something that would get us a lot of return and the greedy nature of the people could make them trade like this.
So, the middle ground is that if you really want to do it, then you should simply just end up doing it with very little money so that you wouldn't end up with losing all of it at the single trade. The mistake there was that OP's friend invested ALL his money to a single trade, that is way too much risk, there is no need to put that much money into that much risk. If you really want to try it, then just do like 5% of your portfolio into a single trade and learn the hard way that it can be gone, and all you would end up could be 5% loss.