SPX - Wyckoff Distribution SchematicS&P 500 IndexTVC:SPXVIAQUANTWith the recent developments unfolding over the weekend regarding the geopolitical situation, this could mark the final step of distribution (according to the Wyckoff Distribution Schematic) before the sustained downtrend begins. On Friday I outlined for both BTC and ETH how the Iran deal could end up being a classic "buy the rumor, sell the news" event. The same applies to the S&P 500, and I will walk through each phase of distribution, how price has been tracking it, and the past ideas that support this hypothesis. PS — Preliminary Supply The first sign that large sellers are beginning to enter the market. Volume increases but price still pushes higher. BC — Buying Climax The peak of retail euphoria. Smart money aggressively sells into this final push higher, usually accompanied by a volume spike. In my analysis, this occurred on October 30, 2025 before the index dropped 5.75% in less than a month. Back in June 2025, when price was still trading at $6,085, I outlined that the S&P 500 would top around the 1.618 extension at $6,965 before the end of the year: The S&P reached the Buying Climax around $6,921 on October 30, 2025 which is right in line with that prediction. AR — Automatic Reaction The first sharp drop after the BC, establishing the lower boundary of the trading range. This set the Automatic Reaction low at $6,550 which also happened to be the early October low before the push to the BC, creating a short-term double bottom at that level. I identified this level as important back in early March and labeled it as the "First Target" for a breakdown: ST — Secondary Test Price rallies back toward the BC high but fails to exceed it, confirming supply is still in control. This is where price created a lower high at $6,903 on December 11, 2025 before falling back to $6,720 on December 17, 2025. Upthrust A false breakout above the trading range designed to trap breakout buyers and give institutions more liquidity to sell into. I outlined this multiple times as price continued to get rejected at the 1.618 extension level with sellers overwhelming buyers: Minor Sign of Weakness The first break below trading range support, confirming distribution is complete. I outlined this breakdown beginning here: Once price broke below the $6,550 AR level it created the Minor Sign of Weakness with a low of $6,317, before climbing back above the AR level and completing that phase of distribution. Upthrust After Distribution A second and more powerful false breakout above the range. The final liquidity grab before the markdown begins. Once headlines emerged declaring the war was over and the Strait of Hormuz was reopening, markets surged with optimism and the S&P 500 rallied to a high of $7,148 which perfectly aligns with this phase. Now that peace talks appear to be failing and escalation is ramping back up, this could be the perfect scenario to fulfill the UTAD and validate the "sell the news" theory I outlined in my Friday BTC and ETH ideas: If this plays out and the S&P reclaims the price range below the BC level and the 1.618 extension, this entire move to the upside will be considered a "false breakout". LPS — Last Point of Supply The next phase that should theoretically follow is a weak rally after the range breaks down, failing well below prior highs. This is where the red circle is highlighted on the schematic which would be the final opportunity for late shorts to enter. Major Sign of Weakness The accelerated breakdown and beginning of the sustained markdown phase before a true bottom is established. If this occurs, the (extended support targets outlined in the green box) from this idea could come into play: One Final Note — Post Q1 Midterm Fractals Something worth pointing out before wrapping up. Around this time of year in midterm election years, we have historically seen some sort of selloff begin. If this is indeed a top for the S&P 500, it would have been established on April 17th, 2026. Looking back at 2022, price created a pivot high on April 21st before a 19.5% decline that lasted until June 15th: Looking back at 2018, a pivot high formed on April 18th before a 4.5% decline lasting until May 3rd: If a top does end up forming on April 17th, I find it remarkably interesting that it would align with a similar time fractal seen in the past two midterm years. What I am projecting would likely be a longer-term correction than what we saw in 2018 but either way, it is a noteworthy data point worth keeping in mind. I am interested to hear others' opinions on this hypothesis. Is the top in, or will the S&P defy expectations and continue pushing toward new highs at $7,400? Let me know your thoughts in the comments below.