From my own perspective I think everyone has to be prepared to invest,even in the therms of down fall you shouldn't be discouraged in whatever you invested in, because the end points is the main reason you always invest your money.
You invest to make more money. If you believe in Bitcoin you can buy at any price because you will know it will go up again even if it goes down. When the price goes down and if you didn't sell you can always buy more
that's why you need to have some money in spare. A lot of pieces in the market goes up and down but one thing is for certain, it's that Bitcoin will always go up at one time. You won't bankrupt with Bitccoin, though you always have this possibility with stock exchanges or altcoins. Bitcoin is concrete strong.
You are right. But the emphasis is on continuous buys and avoiding panic sales. Investment is aimed at long term of at least 4 to 10 years. To achieve this you have to be financially knowledgeable and strategic in your goals. You don't invest all your money in bitcoin while hoping that the market turns overnight for a pump. Give more attention to your back up funds and your emergency funds because that's the strength of whatever amounts of bitcoin you have in your wallet.
The more you invest in your backup funds and emergency funds, the longer you are able to hold your bitcoin stash. You must also avoid trading bitcoin in order not to run into loss.