Blank Bale Gotitwithmybow!
No work, no reward. The target panic will go away only if you really want to work at it. If you do, blank bale my friend...blank bale.
Take the sight off your bow and set yourself up at 5 yards. Shoot for 30 minutes and close your eyes for the shot (taking a little care to aim first). Feel the shot. After a week of this put your sight back on and put up a paper plate at 5 yards. Shoot it. Yeah, I know it'll seem like duck soup. Feel the shot. After a week of this reduce the paper plate size a little and move the target back to 10 yards. Repeat the whole process again. Yeah, I know it'll seem like duck soup. Feel the shot. After a week of this move the bale back to 15 yards and repeat the process again. Yeah, I know it'll seem like duck soup. Feel the shot. After a week of this move the target back to 20 yards and repeat the process again. By this time the paper plate should be cut down to the size of a 5 ring on a spot target. Yeah, I know it'll seem like duck soup. Feel the shot.
By the time that you're done you may very well have found that your target panic will have gone away. Don't be afraid to repeat the process. I know some very good archers who will do this on a regular basis.