I understand some people struggle when it comes down to the decision between averaging down or out completely.

So I just want to share my way of comfort trading once I decide to hold longer rather than "hit and run" process.
I normally do this for B or B2 flag stocks when I know clearly SVM 600 day bottom.

To give you a better understanding, all of trade example below with 1,000 shares.
Your initial entry was 18.
Stock goes down.
You added at 16.
Do not calculate average.
This is tricky part....
I treat these 2 transactions separately.
It means that I treat independently as if I bought 2 different symbols at different price.

 - If the stock bounce back up: I sell the shares that I bought at 16. Let say the stock bounce back up to 16.8. I sold and book 80 cents profit.
So now original position from 18 would averaged down automatically at 17.2.

- If the stock goes dip further: I sell the shares from the top position at 18. If the stock goes down to 15. I sell the stock from 18 and book the loss of $3. Move on and repeat same step. Adding more at 14.
Once the stock hit the true bottom, it will bounce hard and when it surpass the 16, you gain $1 per share but you have double position....so your net loss would be $1,000 at 16.
You are break even at 16.5.