The Next Asset to Target: Preparing for the ‘Trickle-Down Effect’ in Commodities

For much of this commodity cycle, gold has been the leading commodity, absorbing the bulk of investment attention and speculative enthusiasm over the last couple of years.

And that’s worked out well for ASX investors, given gold makes up a major swathe of the listed mining companies in Australia.

But if you’ve been a long-term reader, you may recall that I’ve often described gold as an EARLY mover; the commodity that tells us changes are underway…

In past bullish cycles, gold was often the first commodity to rise in value.

Some readers may be familiar with this concept, such as the historical trend where silver traditionally follows in gold’s wake. We certainly watched that play out over 2025.

However, less familiar is the concept that other commodities tend to follow gold’s lead, even those with no connection to gold as a monetary metal.

Last year, I wrote that industrial metals, such as copper, aluminium, and zinc, should sit high on your list in the wake of gold’s strong performance that began in 2024.

There was an inevitability to how this was all playing out…

Each one of those commodities has performed well on the back of gold’s record run. And in 2026, that’s spilling over into traditional energy.

Overall, it demonstrates that we are sitting in the middle of a classic commodity-wide bull market.

And the Wheels are still Turning

It began with gold, then silver and industrial metals. In early 2026, it shifted towards traditional energy. So, what comes next?

This is the interesting feature of commodities… ‘markets within markets.’

Some will display weakness while others move towards strength. Yet, overall, they are all moving towards the same objective: higher prices.

So, how do you invest with that broad theme in mind?

One approach is to look at mining service stocks; these companies are fully leveraged to rising activity across the entire resource sector.

As activity elevates, mining service stocks experience a direct uplift in revenue and underlying profit. They’re not necessarily tied to a single commodity.

They also directly benefit from any uplift in CAPEX, which could include rising drilling activity or mine expansions. And that’s built on confidence across the whole sector, which is buoyed by these dynamic multi-price lifts.

So, how else could you invest alongside the broad commodity cycle?

Watch the commodities (and
companies) that have sat idle

Resource bull markets have a habit of floating all boats…

A good example of that was oil and gas in early 2026. The traditional energy market was a clear laggard for many years.

Yet, like all cycles before it, events transpired so that the traditional energy market also had its time in the sun. It’s the constant waxing and waning across the commodity spectrum that I find fascinating.

But it also offers clear opportunities if you’re attuned to how it operates.

And while you could hunt for commodities sitting idle as the next potential mover, you can also focus on companies that have remained dull but perhaps readying for a future move higher.

Over the last 2-3 years, investor capital has focused on income-generating companies — those demonstrating immediate balance-sheet health thanks to rising commodity prices.

Again, that’s typical; investment starts with the producers first. At that stage, investment turns positive, but it’s not what I’d describe as speculative.

Yet, if this cycle follows previous ones, sentiment will start to trickle down the development pipeline… The small-scale miners, developers and explorers, or what we’d describe as the junior mining sector.

You can sum it up like this:

2025 was the year when miners and other income-generating stocks within the resource sector surged, thanks to rising commodity prices and a shift in investor sentiment towards real-asset investments.

But today, signs are pointing towards an elevation in speculation; whether that’s copper breaking into new all-time highs, the broad rally across many commodities over the last 12 months, or the recognition that there’s a vast discrepancy in valuations between large caps and small caps across this sector.

Again, I think there’s an inevitability to how this plays out…

Just as I said, copper, aluminium, zinc, silver, gas, oil, coal and other mainstay commodities would follow gold’s lead, I think capital will soon make its move towards the junior mining sector.

Preparing for the ‘trickle-down effect’

But there is an important timing aspect to all of this, which is why I’ve just finished putting together an event that profiles this setup and the strategies you can deploy as we enter the next phase of this cycle.

If you’d like to secure your spot for our upcoming session and learn more about how it works, you can do so here.

Until next time.