Detailed Breakdown of NASDAQ (NAS100) 1H Chart

Wyckoff Distribution Breakdown
The Wyckoff Distribution pattern suggests that a market has reached a point of exhaustion in its bullish run, and large institutional traders are slowly offloading their positions. This process occurs in multiple phases, each representing distinct market activity. Here’s how it applies to the NAS100.

Phase A: Preliminary Supply (PSY)
In Phase A, the market reaches the Preliminary Supply (PSY) stage, indicating that the early warning signs of selling pressure are appearing. During this phase, large investors begin to distribute their holdings, but retail traders often continue buying, driving prices marginally higher.

PSY level in the NAS100 chart is shown around 19,627.2. This marks the initial stage where buying momentum begins to lose its strength, and sellers subtly take over.
Phase B: Build-Up of Supply
In Phase B, the market continues to see a range-bound movement, where large institutional players sell off their holdings to uninformed retail traders. This phase includes a series of rallies and retracements.

Secondary Test (ST): This is a crucial test of the supply level, indicating how much demand remains in the market. On the NAS100 chart, the ST occurs near the 19,900 level, a brief rally after the PSY.

Automatic Reaction (AR): Following the buying climax, prices drop sharply, resulting in a pullback that occurs due to the initial sell-off. The AR level confirms the weakening of bullish sentiment and can be seen around 19,700.

Sign of Weakness (SOW) in Phase B: The SOW confirms that the market's uptrend is faltering. In the NAS100, this occurs around the same 19,700 zone, showing that the large traders have started their distribution in earnest, and selling pressure is increasing.

Phase C: Upthrust After Distribution (UTAD)
The Upthrust After Distribution (UTAD) is one of the most critical moments in the Wyckoff pattern. It is a final attempt by large players to push the market to new highs, luring in retail traders who still believe the bullish trend will continue. However, this is often a trap as the market quickly reverses.

The UTAD level on the NAS100 chart is seen just below 20,007.6, where prices spike, hitting their final high before a sharp decline. This marks the peak of the distribution phase, indicating that the bullish trend is over.
Phase D: Final Distribution and Last Point of Supply (LPSY)
Phase D marks the beginning of the end for the bullish market. At this point, the distribution has concluded, and the market starts trending downward. The Last Point of Supply (LPSY) is where the remaining supply is distributed, and any price rallies from here are weak and short-lived.

In the NAS100, the LPSY level is critical because it confirms the transition into the markdown phase, leading to lower price levels. Any attempt to rally will likely meet resistance, and from here, sellers will dominate.
Phase E: Markdown
In Phase E, the market has fully transitioned into a bearish trend. Prices move sharply lower as supply overwhelms demand. This phase often leads to a significant markdown in price, where all remaining bullish sentiment evaporates.

The chart's Elliott Wave count shows that the NAS100 is likely entering Wave 3 of the bearish Elliott Wave structure, which is typically the most powerful and steep phase of the wave cycle. The forecast suggests that prices could head toward the Point of Control (POC) level at 19,450, marking the next potential support zone. Below this, there is an invalidation point around 19,000, where the broader bullish structure would be entirely negated.
Elliott Wave Analysis
In conjunction with the Wyckoff Distribution, Elliott Wave Theory is used to predict the market’s next movement based on the fractal nature of price waves.

Wave 1 marked the initial decline after the distribution phase, where sellers gained control over the market. This was followed by Wave 2, a corrective move that briefly retraced the bearish trend but failed to breach new highs, confirming the distribution pattern.

Wave 3, which appears to be forming now, is expected to be a significant bearish impulse wave. This wave could bring prices further down, breaking support levels established during the earlier bullish phases.

Based on this Elliott structure, the Wave 4 invalidation level is key. If prices breach this point, it will invalidate any remaining bullish sentiment, accelerating the bearish trend.

Future Outlook
Given the combination of the Wyckoff Distribution and Elliott Wave structure, NAS100 appears to be entering a marked down phase, where prices are expected to continue their decline. The key levels to watch are:

POC (Point of Control) at 19,450, which could serve as the first significant support zone.

Wave 4 invalidation point at 19,000, which, if breached, will signal a continuation of the bearish momentum.

In the coming days, traders should expect more downside movement, particularly as Wave 3 of the Elliott structure accelerates, pulling prices towards the lower boundaries. This analysis strongly suggests avoiding long positions at this stage and potentially looking for shorting opportunities if price rallies fail near resistance points.

Conclusion
The NAS100 is showing clear signs of entering a bearish markdown phase, as indicated by both the Wyckoff Distribution and Elliott Wave patterns. Large institutional players have likely finished distributing their holdings, and the market is poised for further downside. Traders should be cautious of any short-lived rallies and focus on the key support and resistance levels highlighted above for potential trading opportunities.

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