It's not time to ring the alarms on Wall Street.

According to a report from LPL Financial, this market isn't heading toward any sort of catastrophic meltdown despite the recent selloff.

Though it's not totally clear how long this selloff will last, LPL noted that stocks are strongly supported by economic and earnings fundamentals. Interest rates remain historically low despite the recent rise and wage pressure still isn't strong enough to alter the Federal Reserve's current course of action this year.

LPL remains convinced the stock market still has gains to make in 2018 and maintains a fair value S&P 500 range between 2,850 and 2,900.

"We do not see the makings of a significant stock market top or major downturn and continue to believe stocks are well supported by fundamentals," LPL wrote. Here's why.

It Wasn't a Melt-Up

The major downturn on Friday, Feb. 2, seemed to have erased the memories of earlier in the week, when investors were calling for a melt-up in the market as stocks appeared to swiftly and sharply move higher.

According to LPL, Strategas Research defines a melt-up as a top five percentile rally in the S&P 500 within six months when the index is at new highs.

"Based on data back to 1985, the top five percentile of 6-month performance for the S&P 500 is 21%," LPL wrote. "The recent peak in 6-month rolling S&P 500 performance, on January 26, 2018, was 16%, well short of that breakpoint."

And even if it was a melt-up, LPL noted, there's no reason a melt-up precludes further gains in the market. If you bought any of the 13 statistical melt-ups in the S&P 500 since 1980, you would generally end up tallying gains. The S&P rallied on average 4% in the six months following a melt-up with gains 75% of the time.

We Were Due a Pullback

"Whether stocks have experienced a melt-up or not is open to debate," LPL said. "But there is no doubt stocks have experienced record-breaking gains and tranquility over the past 12 months, and a pullback was overdue."

The S&P set the all-time record for trading days without a 5% correction at more than 400 sessions, LPL noted. The index generated a positive return every month last year for the first time in history. And although the index endured two 1% drops last week, LPL pointed out, its 113-day streak without one through Jan. 29 was the longest since the mid-1980s.

Breadth Healthy

"The percentage of stocks at new highs recently reached a five-year high while a healthy percentage of stocks are in uptrends," LPL wrote. About 80% of stocks listed in the S&P 500 have maintained 50-day moving averages above their 200-day moving averages despite the market decline.

Credit Spreads Tight

Credit spreads remain "well-behaved," LPL noted, despite the rise in yields. LPL said it doesn't expect spreads to widen in a meaningful way this year because of improving economic growth and strong expected gains in corporate profits.

Deal Activity Muted

Investors would expect more M&A and IPO activity at the height of a bull market. But deal activity in this market remains on a pace slower than two years ago at historical lows.

Earnings Revisions Strong

Strong positive revisions to earnings estimates bodes well for the stock market. S&P 500 earnings estimates have increased more than 5% so far this year, "bolstered by the new tax law, accelerating global growth and a weaker U.S. dollar," LPL said.

Speculation Not Excessive

"Investor surveys such as that from the American Association of Individual Investors are optimistic but not off the charts," LPL wrote. "Equity inflows have been subdued overall."

Bottom Line

Global growth is teed up to accelerate this year, corporate America is in "excellent shape," the new tax law suggests profits could increase to the tune of the mid-teens, inflation remains well contained and stock valuations are still supported by low interest rates despite a jump in Treasury yields.

"Bottom line, we believe the latest downdraft in equities appears to be an emerging buy-the-dip opportunity rather than the start of a significant selloff," LPL said.

"Keep in mind, a 5% drop in the S&P 500 still puts the index slightly above its 50-day moving average, while even a 10% correction could leave the index above its 200-day moving average."