No it is fine. Ok, without looking like I obsess about horse's groins (which I don't, but I have fallen off so many I have had time to see under a few, justify justify) the following may be useful;
Male horses keep their penis in a sheath (picture linked below);
They only hang their penis out for sex or urination etc - think of all the nasty racing accidents there would be over big brush fences if not 8).
The sheath does not look like testicles because it isn't; they are further back and higher up - you don't normally see them on a stallion when looking from regular angles and geldings don't have any anyway of course.
So normally you would see something rather different from your model if the horse is galloping along; not saying it isn't all in there somewhere just usually it isn't all hanging out in the breeze.