Dow over 16,000: Time to cheer? Worry? Chill?

In one of the most dramatic signs yet of the bull market's strength, the Dow Jones industrial average closed above 16,000 for the first time in the much-watched average's 117-year history.

The Dow's accomplishment, which came on better-than-expected unemployment news, was the latest major milestone to fall in a bull market that's riding the powerful combination of a slow-but-steady economy, solid corporate profits and record low interest rates, thanks to the Federal Reserve.

After crossing but not being able to hold 16,000 Monday, the Dow had no problem Thursday as it jumped 109 points to close at 16,010 for a 0.7% gain on the day. Other major U.S. indexes also ended close to their own even-number milestones. The broader Standard and Poor's 500 is shy 4 points shy of 1800, and the Nasdaq composite is 31 points from 4000.

"People may discount milestones, but they are psychologically significant," says Todd Salamone of Schaeffer's Investment Research.

BUBBLE TALK: Rooted in reality?

The Dow took out the 16,000 level just 198 trading days after toppling the 15,000 barrier on May 7, 2013, says S&P Dow Jones Indices. For comparison, 14,000 to 15,000 took 1,460 days, while 13,000 to 14,000 took just 59 days.

Seeing the market charge higher may start to get investors, who have avoided stocks since the 2008 financial crisis, to perhaps wade back in, says Ken Winans of Winans Investments. Dow 16,000 "is the catnip to the retail investor. When people talk about the Dow, they don't talk about Dow 15,995. They care about Dow 16,000," he says. "Those that missed this rally will call their brokerage and jump in."

The market's rise has been staggering, too, given the number of problems the economy and investors had to look past. "The whole market has climbed a wall of worry, including a fiscal cliff, interest rate worries, government shutdowns," Winans says. "There have been many reasons for this market to blow up, and it hasn't."

Meanwhile, bearish investors who c! lung to what are supposed to be safe investments such as gold and bonds have been hammered. "People are saying, 'What I thought was safe is not safe at all,' " Winans says.

The market's rally has also been a bitter pill for investors calling the market a bubble and saying it's at risk of a financial crisis, just because it was rising, Salamone says. The market is moving higher, but that doesn't mean it's overinflated, he says.

Many measures of market sentiment still show that investors are bearish, Salamone says. Flows into U.S. stock mutual funds are still slow relative to the outflows of the previous few years and the number of investors placing bearish bets on stocks is higher now than it was at the start of the year, he says.

"We wouldn't be surprised if there's hesitation as indexes challenge round numbers," Salamone says. "But we'd stay on the (buying) side."