Let's take break from the norm here and talk about some international economics as it related to trading opportunities abroad. The general consensus for many economists is that Brazil, Russian, Inda, and China will combine to be the prevailing economic powerhouses of this century. They all have GDP's that continue to soar and they've signed trade agreements that assure economic ties for years to come. Today, we will briefuly discuss these countries and tehn we will move on to a few ADR's (foreign stocks traded on the NYSE).

One of the main reasons that the BRIC's (Brazil, Russia, India, and China) have potential to be the economic powerhouse of the 21st century is their recent adoption of global capitalistic economies. Goldman sachs reported that BRIC economies currently are responsible for 20% of the world growth in GDP. That number will swell to 40% in 2025. Ultimately, this will . Part of the reason why these economies are so intwined is that China and India are become dominate providers of manufacturing and services, while Russia and Brazil have much of the supply of raw materials. It's a match made in heaven. As far as the stock market goes here is how these markets have performed in the last 12 months

1. China (Shanghai) - up 40%
2. Brazil - up 40%
3. India - up 37%.

Let's move on and talk about how to trade these stocks. I have found that when trading ADR's, the best way to trade is to time the underlying market first. Let's look at an example. For most foreign markets, it's highly effective to use %R and RSI to find oversold conditions. These make for good entry points. When you're done finding a company with bullish conditions, move onto the right ADR. I find once again that stochastics, RSI, and %R are the best at finding short-term entry points for call options. To sum it, opportunities outside of the US and plentiful. Economic and market trends are very bullish for ADR's. Use your trading system to take advantage.

Price Headley is the founder and chief analyst of BigTrends.com.