Parreira, who coached Brazil to its 1994 World Cup triumph, expects Brazil to win its first Olympic title at the London Games after the exit of fellow gold medal favourites Spain and Uruguay. Brazil reached the semifinals on Saturday thanks to a 3-2 victory over Honduras.
"Brazil has a very strong team technically, very consistent, and a lot better than the rest of the teams left in the tournament," Parreira told The Associated Press on Saturday from Wembley Stadium, where he watched Mexico beat Senegal 4-2 in a men's quarterfinal.
"Now that favourites like Uruguay and Spain are out, Brazil shouldn't have any opposition," he added. "But they have to be wary as in these small tournaments, you can pay dearly for any little error."
Japan beat Egypt 3-0 on Saturday to reach the semifinals, with Brazil or Honduras facing either Britain or South Korea in the other half of the draw.
The 69-year-old Parreira, who is at the Olympics for FIFA, believes the games are just the event Brazil needs to stay competitive as it does not have to qualify for the 2014 World Cup as host. The current squad is just two or three changes away from being the final one for 2014, with Neymar as the key.
"He still has to mature a lot but at 20 he's one of the best strikers in the world and one of the few players who can make the difference in a game," said Parreira, who won't return to coaching after last leading South Africa at the 2010 World Cup. "He loves football, he dies to play it, and that is important."