Is the S&P 500 ready for another pullback?

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While the S&P 500 hits new highs, the number of companies following suit has been decreasing, suggesting that short-term momentum may have peaked.

The stock market is once again flirting with record-high levels since touching a two-month low in mid-June. Small- and mid-cap stocks have led the gains, up 11 percent and 10 percent, respectively.

Investors often look at waning price momentum along with volume to predict the direction of a security or index.

So far this year, the average number of S&P 500 companies reaching new 52-week highs stands at 62, but it has been trending down in the past three weeks. Could the market be poised for another breather?

—CNBC's By Pradip Sigdyal.