Market Report: Trading Tactics: Market Direction Alert – Plus, Three New International Plays

If you take a look at the chart below, you’ll see that the Dow is calling the 200-day moving average a strong support point. At first glance, you might consider this a very bullish signal. But the real test will come when the Dow tests the resistance level at the 50-day moving average, which is now only 200 points above current levels.

If the Dow can penetrate this 50-day moving average, you’ll most likely see a strong year-end rally. But if the Dow cannot penetrate this level, you'll probably see more intraday volatility over the next two to three weeks.

So, based on this situation, today’s tactical alert resolves around three investments that could offer you strong upside exposure even if the Dow finds resistance at the 50-day moving average.

The trick is that all three investments (outlined below) offer you exposure to International markets that are growing at a rapid pace.

For example, Millicom International Cellular (MICC: Nasdaq) offers local and long-distance telephony and broadband Internet services to 14.9 million subscribers in 16 countries, including El Salvador, Guatemala, Honduras Bolivia, Colombia, Paraguay, Chad, the Democratic Republic, Ghana, Mauritius, Senegal, Sierra Leone, Tanzania, Cambodia, Laos and Sri Lanka. The stock just hit a new 52-week high today at $124.95 and looks poised to continue moving higher.

Along the same lines, Telefonica (TEF: NYSE) provides fixed and mobile telephony and Internet and broadband multimedia services throughout Spain, Europe and Latin America. The stock hit a new 52-week high yesterday at $102.50 and also looks poised to continue moving higher.

Over in the oil and gas sector, one of the best international plays is Petroleo Brasileiro (PBR: NYSE). In fact, I just recommended call options on PBR in my Bottarelli Research trading service. Petroleo Brasileiro engages in the exploration, exploitation and production of oil in Brazil. They also supply natural gas and power to Argentina, Angola, Bolivia, Colombia, Ecuador, Equatorial Guinea, Iran, Libya, Mexico, Mozambique, Nigeria, Paraguay, Peru, the United States, Tanzania, Turkey, Uruguay and Venezuela.

Investing in all three companies offers you the advantage of having international exposure, which offers you protection against any intraday mood swings of U.S. markets (caused by poor housing or retail numbers, for example).

Taken together, I feel that MICC, TEF and PBR should all be stocks that you own in your portfolio. That way, you’ll have a diversified mix of rapidly growing companies with business operations outside of the U.S, offering your portfolio a global position allocation that’s poised to increase in value no matter what happens at the Dow’s 50-day moving average.

Bryan