Before talking about 'rebalancing', it is probably best to try and define 'balancing' in the first place.
In short, there are different broad categories of assets you can invest in. The most common classifications would be 'equities' [the stock market], and 'debt' [bond market, government GIC's, t-bills - anything that earns interest]. Other categories could exist, most notably 'real estate', but for simplicity we will refer to debt and equity.
Debt typically has lower risk than equity - this is because a debtholder has a legal right to even, pre-determined payments, and must be paid back in full, if possible, at the point of bankruptcy. Because it is lower risk, it also has a lower rate of return.
Equity typically has higher risk than debt - this is because when you own shares, you only have a right to dividends that the company choose to pay, and at the time of bankruptcy, you would only get anything back if all other debtholders etc. have been paid out [very unlikely]. The tradeoff is that only equity holders truly reap the reward of profits from the company, and if the value of a company's future earnings doubles, then the value of its shares would theoretically also double.
One common piece of advice is to invest in a balance of debt and equity. How much of each you hold should depend on your risk tolerance, and specific circumstances like the time until you need the cash. [ie: if you want to buy a house in 5 years, don't invest in equities, because the market might dip when you need a down payment. Or, if you are going to retire in 10 years, consider reducing your equities and increasing your debt holdings so that you can more safely retire].
The balance that is right for you would depend on many things - but let's assume that you talk with a qualified advisor who is acting in your best interest, and they suggest you hold 30% debts and 70% equities. For simplicity, let's assume you have 50k in money to invest, so you would have 15k in lower-risk interest-bearing investments, and 35k in equities. After a year, you look at your portfolio - perhaps your debt holdings are worth still 15k, but your equity holdings are now worth 40k, because some shares you held increase in value. Rebalancing your portfolio would mean you would sell about 1k of your equities and buy about 1k of interest bearing investments, so that you maintain a 30%-70% split
In a way, rebalancing is actually avoiding 'timing the market', because it requires you to set, in advance, a series of rules that adjust your investment mix, instead of saying at some point 'I think the stock market is undervalued at the moment - I'll liquidate my bonds and keep buying stocks instead'.
Whether it makes sense or not is not an objective fact, but it is common advice that exists to make sure that you don't look at your portfolio in 10 years and realize that 95% of your investments are high-risk equities.