Blog Categories as a Dropdown

I would like to create a blog page (under Main Navigation) with categories that pop-up as a drop down much like when a folder is created with multiple pages within. Is this possible?

The only way I can figure out doing it is creating the blog under the Unlinked Navigation area, creating a folder under Main Navigation with links named after each blog category and link to the specific category. For example:

BLOG (Folder)

 --> Category 1 (linked to the Category 1 link)

 --> Category 2 (linked to the Category 2 link)

 --> Category 3 (linked to the Category 3 link)

 --> All posts (linked to the main blog feed)

There's got to be an easier way than this. Thanks all!