Recently, someone asked me how to get involved in bulk commodity trading, and I think this topic is definitely worth a deep discussion.

To be honest, many people’s understanding of commodities still stays at the stereotypical impression of "big and complicated." But if you look closely, you'll find they are everywhere in our daily lives. Plastic bags made from crude oil, copper wires, cotton clothes—these are all bulk commodities. The key point is that the price movements of these items can actually reflect the pulse of the global economy very well.

My own observation is that there are actually not many bulk commodity types worth participating in. First, there must be sufficient liquidity, meaning a large amount of capital is involved in trading, so that prices can be discovered properly and are less susceptible to manipulation. Second, it’s best if the prices are globally standardized, like crude oil and gold—you can trade them based on world market prices without regional restrictions.

From this perspective, crude oil, copper, aluminum, gold, silver, soybeans, corn, sugar, and cotton are the main ones I focus on. Why? Because they all share a common trait: the market is deep enough, demand is stable enough, and information is transparent enough. Especially energy and agricultural commodities, which have rigid daily demand worldwide, this determines that their prices follow a logical pattern.

Regarding investment methods, I find that many beginners are initially scared off by futures. Actually, the core logic isn’t difficult: futures contracts correspond to the spot price of a specific month in the future. What you need to do is predict the market conditions at that time. The most important part here is fundamental analysis—looking at macroeconomics, supply and demand, which determines the overall direction of prices.

But my experience is that relying solely on fundamentals isn’t enough. Technical analysis is also necessary, so you can grasp the specific entry and exit points. I’ve seen too many people who judged the fundamentals correctly but lost money because they entered at the wrong time. Fundamentals tell you the direction; technicals help you choose the right timing. Combining both is the way to go.

Going back to bulk commodity investment opportunities, I’ve noticed that major market moves often occur during global economic cycle resonances. For example, after the COVID-19 pandemic in 2020, central banks around the world flooded the market with liquidity, creating a situation where money was abundant compared to goods. During that period, commodities surged significantly. That’s the kind of opportunity worth participating in.

In summary, bulk commodity investment essentially involves re-pricing the global industrial chain. If you can combine fundamental and technical analysis to make judgments, and choose commodities with good liquidity, global pricing, and strong fundamental drivers, you have a chance to profit. There are no shortcuts in this path, but it’s also not that mysterious.