What to watch: S&P 500 milestone a bellwether?

The U.S. stock market is flying high. It's hitting closing records on a daily basis. And most Wall Street forecasters are saying there's nothing out there -- at least right now -- that can stop the bull market.

With that bullish storyline, it's a good time to keep an eye out for what could portend an end, or a temporary pause to the good times in the stock market. While it normally takes a recession or a super-spike in interest rates or a massive tightening of monetary policy by the Federal Reserve to take the market down in a major way, a sign of weakening momentum often signals a coming dip.

One simple tracking exercise that Main Street investors can employ to spot waning momentum (and this market has been driven in large part by momentum) is to keep an eye on key levels in the benchmark Standard & Poor's 500 stock index.

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The level to watch now on the large-company stock index is 1800, according to Bryan Sapp, a senior trading analyst at Schaeffer's Investment Research.

The index closed above that key psychological level for the first time on Friday, Nov. 22. And Wall Street analysts are watching very closely to see if it can hold that level or whether the big, round number will turn out to be a near-term top for stocks.

"The broad-market barometer has recently found support near this level," says Sapp. "A break below could likely be a sign that a correction is underway." The S&P 500, up 27% this year, hasn't suffered a 10% drop since 2011.

Follow Adam Shell on Twitter: @adamshell.