Muscle loss is possible while dieting, but the rate that it will happen is so often over hyped online. A lot of guys that are very worried about losing muscle tend to be the same guys that never reach total lean states of conditioning. If you are eating the right diet for your body, specifcally a diet ricn in protein, with nutrients timed post AM cadio, you can do fasted AM cardio without lsoing muscle, especially when you are using gear. Cardio is a controlled catabolic event. We are using a window of time to intensely focus on burning fat. Then after you are done, you want to quickly refuel. If you have the diet right and get your food in post cardio, you will not have to worry about muscle loss. In general, when your diet is good, you only have to worry about muscle loss when you get super lean, like low single digit body fat. At that stage, it might take being more extreme with the diet to keep pushing for more fat loss.
One thing you will notice is flattness when you deplete your body for fat loss. When depleted through a hard diet and extreme cardio, the muscle will get flat looking. A lot of guys that are not used to dieting hard, see this and think that they are losing muscle. Understand that you are not going to lose muscle over night. So if you are feeling small and your clothes are not fitting as tight as they were last week, don't freak out. Adding in a refeed or a cheat meal will fill you back out ASAP. The key of dieting is knowing when to keep depleting and when to fill back out. This is the constant question and it will take some experimenting. The fast track is to have a coach like myself or another good coach that will know when to keep pushing and know when to dra back . So watch yourself closely. Don't be afriad of being depleted.
So long story short, I would do your AM fasted cardio without consuming any carbs, fats or protein. Just use water and then track your progress with pics. When you start to feel/look depleted, you might need to fight the urge to fill back out right away. Don't let your ego get the best of you :) Believe me, its a strugle we all can relate to.
For anyone interested in hiring me for 1 on 1 service, to get into the best shape of your life, contact me through the Next Level Nutrition page, here at Naps Gear