Unfortunately people are not doing holding part that well. I can understand some traders willing to sell and even make a loss in order to go back in at a better position but there are way too many people selling their coins for no reason at all, those are the ones that hurt the price most, they panic sell and that causes bitcoin to go down uncontrollably since the price was expected to be drop a bit because of traders for example but than panic sellers start to sell and it goes down more and than more panic sellers join and it creates a wave until there is a buyer that is willing to buy at whatever it is dropped and cover all sellers amounts. Aside from that there is also the dumpers who are looking to just cash out and be done with bitcoin and those people get more crowded when price doesn't go up.
This is a typical game of the whales, and those that are panic selling are cheaply falling into the trap of these whales, these same whales are the ones that comes to the market to probably sell some portions of their coin to create a little dump, and instead of the present investors to understand this and remain firm, they fall into fomo and then start to panic sell, and like you said, as they panic sell, these people still buy their coin back.
How many times would people teach them how to spot whales activities, now that bitcoin is already in uptrend, no matter the correction we may see, the best would be for anyone to just remain calm, if they all remain calm, panicking will reduce, and whales would not be having their ways every time.