Yes, it is advisable to rebalance your portfolio even by selling at a loss. (Note however that we advise rebalancing only the exit load free part of the portfolio).

It's important to understand that if your funds are in losses right now, it will be so irrespective of whether you sell it or not. By rebalancing, you are not exiting the market but just moving your money from an old fund to a new fund that is expected to perform better when the markets do well. This may help in better/faster recovery of losses.

Another benefit of rebalancing at a loss is the tax benefits of booking a loss. 
You can read more about why we recommend the above, here.