Breakdown Phase After Distribution in a Fundamentally Strong Business

Technical + Fundamental View (Weekly Timeframe): On the Elliott Wave structure, the stock appears to have completed a larger impulsive up-move, followed by a distribution phase near the highs. The recent price action suggests the stock is now progressing through a corrective wave (Wave C), with lower highs and lower lows confirming corrective dominance rather than trend continuation. Momentum supports this view: MACD shows clear bearish divergence, where price attempted to hold higher levels but MACD failed to make corresponding highs. This loss of momentum often precedes deeper corrective moves on higher timeframes. From a price reference standpoint, the stock has decisively slipped below the anchored VWAP from the major swing low, which had earlier acted as dynamic support. This AVWAP zone has now flipped into resistance, indicating that smart money positioning is currently cautious and rallies may face supply pressure. Structurally, the next major high-probability support zone lies near the long-term AVWAP and prior accumulation base, much lower than current levels. Until price stabilizes near this zone with improving momentum, downside risk remains open. Fundamental Context: Despite the ongoing correction, the business remains fundamentally strong, supported by: High ROCE, reflecting efficient capital deployment Consistent profit growth over cycles A scalable, asset-light model that benefits from long-term market participation growth