Watch Art Cashin: I'm watching this key S&P level

Cashin says ISM helped but couldn't hold rally

Art Cashin said the stock market is "testing and retesting itself," like a person who has just had surgery or an accident and is not sure whether they're "fully back to health yet."

Cashin, UBS' director of floor operations at the NYSE, told CNBC's Bob Pisani around midday that traders are watching a key technical level for the benchmark S&P 500 stock index.

"In the (morning) selloff, we got to a slightly lower low than Monday's low, which was 1739 in the S&P. We got to 1737, but they held and bounced there. That's not enough of a violation. That's almost a double bottom. So we have to wait and see if the bulls can build on that and maybe retest it one more time and see where we go."

With just over two hours remaining in the session, the S&P was trading around 1755, roughly unchanged on the day.