Introducing VIX and DXY to monitor market moves and USD trends

Deriv has launched trading on VIX (Volatility Index) and DXY (U.S. Dollar Index). These benchmarks help traders track global market sentiment and the strength of the U.S. dollar—two widely followed signals that shape trading decisions worldwide.

VIX measures expected volatility in the U.S. stock market over the next 30 days, based on S&P 500 option prices. Often called the fear gauge, it rises in times of uncertainty and reflects market sentiment.

Meanwhile, DXY tracks the U.S. dollar’s value against a basket of six major currencies (EUR, JPY, GBP, CAD, SEK, CHF). It highlights shifts in dollar strength, influenced by interest rates, trade flows, and economic confidence.

Quick takeaways

• VIX helps traders anticipate changes in market sentiment.
  
  
• DXY provides a clear measure of U.S. dollar strength against global currencies.
• Together, they offer a broader perspective of global markets beyond individual stocks or forex pairs.

How VIX and DXY differ from traditional indices and forex pairs

Unlike individual stocks, indices, or forex pairs, VIX and DXY reflect broader market signals.

• VIX (Volatility Index): Based on S&P 500 option prices, VIX rises in times of uncertainty and helps traders assess market sentiment.
  
  
• DXY (U.S. Dollar Index): Tracks the dollar’s value against six major currencies, highlighting shifts influenced by interest rates, trade flows, and economic confidence.

Why trade VIX and DXY

Both indices react to major events such as monetary policy changes, economic data releases, and geopolitical developments. 

Trading them provides a bigger-picture perspective of global markets:

VIX (Volatility Index)

• Monitor shifts in uncertainty: Spot when volatility expectations are rising and adjust your strategy.
  
  
• Diversify beyond equities: Trade an index that behaves differently from traditional indices. On Deriv, VIX can also complement strategies built on Synthetic Indices, which run 24/7.
  
  
• Hedge against downturns: VIX often spikes when equities fall, making it a tool traders may use to manage stock market risk.

DXY (U.S. Dollar Index)

• Track currency strength: Monitor how the U.S. dollar moves against other key currencies.
  
  
• Anticipate ripple effects: Understand how dollar shifts can influence Commodities and Forex markets. DXY movements can also provide context for trading USD-based forex pairs.
  
  
• Watch Fed signals: DXY reacts strongly to U.S. interest rate changes and central bank policy moves.
• Follow commodity pricing: Because oil and gold are priced in USD, a stronger or weaker dollar often affects their trends.

Start trading VIX and DXY today

Log in to your Deriv account and explore VIX and DXY with a Deriv MT5 Financial account. Or if you’re new to Deriv, sign up now to start trading.