Reasons Behind the Market Plunge

Hey, Ross here:

Welcome back to a new week.

Last Friday was the worst day of 2026 for both the Nasdaq and S&P 500.

Let’s dive in and break down some reasons behind the selloff.

Chart of the Day

First, let’s look at the jobs report.

Unemployment remained steady at 4.3%.

Payrolls rose by 172,000 in May – economists were expecting  80,000.

Good news for the economy…

But bad news for the prospect of rate cuts.

Just take a look at how the probability of a Fed rate hike has changed over the past week.

Right now, options traders are pricing in a 69% chance of a rate hike by the end of the year.

A week ago, they were pricing in a 45% chance.

That’s a huge jump – and it all has to do with the “good” jobs numbers.

You see, with inflation getting hotter and hotter…

A weak labor market is pretty much the only justification the Fed might have for cutting (remember, their dual mandate is to manage inflation and employment).

So with the chances of a rate hike suddenly spiking…

It’s not surprising we saw markets go the other way…

Especially since we just ended a 9-week win streak.

Since 1950 there have only been 10 other times the market went on a win streak lasting 9 weeks or longer.

And as you can see from the chart below…

The market has almost always been higher 1 month after the streak.

Of course, nothing is guaranteed.

But I’ve been saying that this rally is due for a healthy pullback for quite a while now.

It looks like that time may finally be here.

But there’s one critical thing about healthy pullbacks every trader needs to know.

I explain below.

Insight of the Day

Healthy pullbacks rarely feel like healthy pullbacks when you’re in the middle of them

After the pullback is over, and the market resumes its uptrend…

Only then will everybody come out of the woodwork and call it a “healthy pullback”.

But when we’re in the middle of it – the tone is very different.

Because fear spreads faster than greed…

For many people, healthy pullbacks feel less like healthy pullbacks…

And more like the beginning of a huge crash.

But if you’re calm, rational, and logical enough to look at the data…

That’s what will allow you to recognize healthy pullbacks for what they are…

And take advantage of the opportunity accordingly.

That’s why tomorrow, Tuesday June 9 at 11 a.m. Eastern…

I’m going LIVE to show you how to fully exploit this pullback…

And position yourself in what could be the “next wave” of breakout stocks.

The strategy I’ll be demonstrating tomorrow could have had you sitting on 3,272% in open gains across 17 positions (an average of 192%)...

Including individual open gains of 329%, 359%, 416%...

Even 992% on a stock I alerted members to less than 14 months ago.

I’ll break down everything LIVE tomorrow morning.

So just click here to secure early access for the free training…

And I’ll see you Tuesday morning at 11 a.m. ET.

P.S. If you’re planning to attend on a mobile device, make sure you download the presentation app now so you don’t miss anything when it starts. See you there.

iOS: https://apps.apple.com/us/app/goto/id1465614785 
Android: https://play.google.com/store/search?q=goto&c=apps
 
Ross Givens
Editor, Stock Surge Daily