Toyota Repair: 85 corolla wont start, compression gauge, cylinder wall

Question
I have an '85 corolla with a 4AC engine that stopped running while going down the highway. I was not driving it and I have no other information as to the guage conditions when it failed. The engine turns over freely like timing is off, however when the #1 cylinder is at TDC the rotor button points directly at the #1 contact in the distributor also the cam mark is lined up. I removed the valve cover and all valves appear to move up and down. There does not seem to be any compression. There isn't any water in the oil. The car has over 180k miles on it. What is the most likely cause of this problem or what can I check that may tell me where the root of the problem exists?

Answer
I'm going to rule out a broken timing belt from what you told me so far, it would be a good idea to check the compression, or lack thereof, with a compression gauge, check the oil on the dipstick, does it smell normal or is it burned, it is entirely possible the engine overheated to the point where there was cylinder wall damage
When you crank the engine does the distributor rotor rotate?