The ETF tracking Brazil's Bovespa index (trading under the symbol EWZ) returned 10.72 percent for the month of August. That easily trounced other major equity markets, including the United States. The American benchmark S&P 500 index was up just under 4 percent last month.
| Country | ETF | August 2014 returns |
| Brazil | EWZ | 10.72% |
| Mexico | EWW | 4.96% |
| India | INP | 4.49% |
| United States | SPY | 3.95% |
| Canada | EWC | 2.18% |
But Gina Sanchez, founder of Chantico Global, thinks some of the enthusiasm for Brazil by foreign investors may be misplaced.
With Brazilian Socialist Party's Marina Silva nearly tied with incumbent Dilma Rousseff a month before the presidential elections, some might be buying Brazilian stocks expecting a reform-minded challenger to usher in a change and a bull market pop. But that's not the case here, according to Sanchez.
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"Marina Silva doesn't have a particularly strong reform-oriented mantle," said Sanchez, a CNBC contributor. "Some of this rally is really not justified. So I do think that some of this is going to come off."
However, the EWZ's technicals appear to be more bullish.
"The chart looks terrific," said Craig Johnson, senior technical analyst at Piper Jaffray. Though he sees the possibility of a short-term pullback, "I wouldn't be surprised to see EWZ move up 20 percent from where we are today just based purely on the price action that we're seeing."
Johnson believes the ETF has demonstrated a longer-term reversal of a downtrend, which he sees as a change of trend and a turn to more positive sentiment.
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But Johnson thinks there will be challenges. He sees a strengthening dollar putting pressure on oil prices, a major Brazilian resource.
"That could be a little bit of a headwind for this particular call," Johnson said. "But nonetheless, the chart looks great and we want to be long these kinds of downtrend reversals."
To see the full discussion on the Brazilian market and the EWZ, with Sanchez on the fundamentals and Johnson on the technicals, watch the above video.
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