Panic selling is not just a textbook-reality or Hive-post-reality, but it is just as real as crypto assets ("Internet money") can be converted into REAL CASH (spendable money).
In other words, it is 💯 real!
There are so many people who would swear an oath that no matter how dip the dip goes, they would never panic-sell their coins. But, when faced with the reality of the BEAR, "panic-selling becomes an indispensable factor to ascertain the safety of their assets."
Just as you rightly pointed out, sometimes it may work out to their favour and other times they will be REKT.
For instance, someone who panic-sold his Steem at $3.1 when the Market was crumbling will be praised as a sharp guy who saw the future. On the other hand, if Steem had bounced up back from $0.9 to $4 and ultimately $50 after 7 days he panic-sold his coin, then he will be compared to the Man who was happy he sold off his BTC at peanut price.
On my part, I may be so slow to judge those who panic sell because of the the above instance. However, I also feel it depends on the trust for the project, coin or community. Infact, it boils down to the question:
"WHY THE HELL DID YOU BUY A COIN OR FOLLOW THE PROJECT IN THE FIRST INSTANCE?"
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You're 100% correct. While I might not panic sell, the reason I might do so is if I'm losing trust in tne project or if I need the money. Most times it's always the latter. But I haven't panic solid because these situations have not been presented into crypto endeavors.
Another thing is that my bag is extremely small so I can handle everything I've got.
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To an extent, these two cases (losing trust in tne project or if I need the money) go hand in hand.
The trust concern plays a huge role in panic selling, especially when it is a new project. Or when we hear a news that disrupts buyers and sellers relying on Fundamental Analysis. And when an individual didn't really plan on investing long term for such project. This will prompt panic selling also.
However, just like you said, it is important to coat your cloak according to your size. Invest what you can handle, come what may happen.
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