First of all, know what crude oil is. Crude oil is oil, also known as "black gold". Traditionally, it is called crude oil extracted directly from oil wells. It is a dark brown or dark green viscous liquid or semi-solid combustible substance composed of various hydrocarbons. Although crude oil investment started late in China, it is still very similar to the operation mode of international spot gold, with some differences:
First, crude oil is more sensitive to economic changes, while gold is more sensitive to currency changes. A large part of the demand for crude oil comes from industrial demand, accounting for about 40%. On the contrary, the demand for gold is basically investment demand and jewelry demand.
Because of the close relationship between crude oil and industry, crude oil is very sensitive to changes in economic factors, such as industrial productivity and manufacturing demand.
Second, crude oil mainly focuses on the situation in the Middle East and shale oil in the United States, and is also easily influenced by Chinese and American factors. Gold mainly focuses on the US dollar index.
Crude oil is greatly affected by news, like crude oil storage data, because crude oil will be consumed, gold will not, and gold can always be in stock.
Third, compared with gold, crude oil is more volatile. Small market scale, low liquidity, and demand fluctuation between industries and stored-value uses lead to increased volatility of crude oil trading.
Fourth, crude oil and gold come from different product resources, which will also have a very important impact on their prices. The relationship between crude oil production and crude oil price is not as close as that between gold production and gold price. Because most crude oil is produced as by-products of metals such as lead, zinc, copper and gold.
Although the trading mode of gold and crude oil is the same, they are both two-way operations, buying down and buying up, and speculating the price. But to some extent, it is difficult to judge the long-term trend of crude oil only by technical indicators, because there are many political factors to consider. Even abnormal weather changes should be taken into account.