DXY in one paragraph
DXY is the US Dollar Index, calculated against a basket of six currencies fixed in 1973: EUR (57.6%), JPY (13.6%), GBP (11.9%), CAD (9.1%), SEK (4.2%), and CHF (3.6%). Because more than half the weight sits in EUR, DXY behaves almost as the inverted EUR/USD chart with a smaller drag from the other five. The basket excludes the Chinese yuan, Mexican peso, Korean won, and every emerging-market currency, so DXY is the standard headline dollar gauge but not a true broad-dollar measure. You can trade DXY at LHFX as the DOLLAR CFD on MT5 with leverage up to 1:200 and $3 per side commission.
What DXY actually tracks (and what it ignores)
DXY is a synthetic basket index that measures the US dollar against six other currencies. The basket was set in 1973 by the Federal Reserve Bank of New York after the collapse of Bretton Woods, when major currencies first began to float. The weights were chosen to reflect the relative trade importance of the United States' largest partners at that time, and they have only been touched once: in 1999, when the euro replaced the deutsche mark, French franc, Italian lira, Dutch guilder, and Belgian franc as a single combined component.
The six components today are the euro at 57.6%, the Japanese yen at 13.6%, the British pound at 11.9%, the Canadian dollar at 9.1%, the Swedish krona at 4.2%, and the Swiss franc at 3.6%. Because the euro accounts for more than half the basket, the index behaves mathematically like an inverted EUR/USD chart with secondary contributions from the other five pairs. A 1% move in EUR/USD typically drags DXY by 0.55 to 0.6% in the opposite direction.
What is missing from DXY tells the more interesting story. The basket contains zero Chinese yuan, zero Mexican peso, zero Korean won, zero Indian rupee, zero Brazilian real, and no emerging-market currency at all. China, Mexico, and Korea are now among the largest US trading partners, and the basket has never been updated to reflect that. DXY is still the most-quoted dollar index on finance television because of inertia and futures liquidity, but as a true gauge of broad dollar strength it is a 1973 artefact.
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The six DXY components and their weights
Below are the six basket members and their fixed weights as published by ICE Data Services, which calculates and disseminates the index. The weights have been static since 1999 and total exactly 100%.
| Currency | Country / bloc | Weight |
|---|---|---|
| EUR | Eurozone (20 countries) | 57.6% |
| JPY | Japan | 13.6% |
| GBP | United Kingdom | 11.9% |
| CAD | Canada | 9.1% |
| SEK | Sweden | 4.2% |
| CHF | Switzerland | 3.6% |
Regional breakdown
Add the components up and Europe is 77.3% of DXY (EUR 57.6% + GBP 11.9% + SEK 4.2% + CHF 3.6%), Japan is 13.6%, and North America (Canada only) is 9.1%. Asia ex-Japan is 0%. The Americas ex-Canada is 0%. Anyone trading DXY as a global dollar barometer is really trading a European dollar index with a Tokyo and Toronto kicker.
How the DXY value is calculated
DXY is a geometric weighted average, not a simple arithmetic one. The formula multiplies each currency's exchange rate against the dollar, raised to the power of its basket weight, and scales the result against a 1973 base value of 100. The base date is March 1973, so a DXY print of 104 means the dollar is 4% stronger than its 1973 starting basket level.
Because the formula is multiplicative rather than additive, large moves in a high-weight component (EUR) compound more sharply than equal-percentage moves in a low-weight one (SEK). A 2% rally in EUR/USD pulls DXY down by roughly 1.15%. A 2% rally in USD/SEK only lifts DXY by about 0.08%. This is why EUR/USD prints often dictate the entire DXY tape and why a sharp move in the krona barely moves the dial.
The index is recalculated every 15 seconds during market hours by ICE Data Services from the underlying spot FX feeds. Brokers including LHFX use the published ICE value as the reference for the DOLLAR CFD. The futures contract (symbol DX on ICE Futures US) settles to the same calculation. There is no rebalancing, no quarterly review, and no committee that adjusts the basket: the math is mechanical and the inputs are six FX rates.
Worked example: a single EUR/USD print
DXY is at 104.00. Headlines say the ECB has hinted at a slower pace of cuts, and EUR/USD jumps from 1.0800 to 1.0900, a 0.93% move. EUR is 57.6% of the basket, so the rough impact on DXY is 0.93% x 0.576 = 0.54% in the opposite direction. DXY drops from 104.00 to roughly 103.44 on that print, before anything else has moved. The other five components contribute the remaining 0.46 of the basket but, in this scenario, were flat.
Why the basket never changes
Most equity indices reconstitute every quarter: S&P 500 adds and drops names, NDX reweights, FTSE 100 swaps in promoted FTSE 250 stocks. DXY does none of that. The 1973 weights are baked into every futures contract, every option chain, and every legacy chart that traders still anchor to, and ICE has no mandate to change them. Updating the basket would invalidate decades of historical comparison and break the rolling futures curve.
The 1999 euro merger was the only adjustment, and it was a mechanical one: five existing components were collapsed into one. The total European weight (57.6%) was preserved, not recalculated against current trade flows. That single edit is why people occasionally describe DXY as updated, but the trade-weight assumption underneath is still half a century old.
For traders, the consequence is practical, not theoretical. DXY responds to European data and ECB policy with disproportionate force. Strong US payrolls plus weaker Eurozone CPI both push DXY up, but a soft Eurozone CPI print on its own can move DXY more than a hot US ISM print, simply because of the basket math. Reading DXY without remembering the 1973 weights leads to misattributed cause and effect.
When DXY trades and where the volume sits
The DOLLAR CFD at LHFX trades from Sunday 17:00 ET through Friday 17:00 ET, with a brief daily settlement break around 17:00 ET. Liquidity is not even across the clock. Because the index is calculated from six underlying FX pairs, DXY's effective liquidity follows wherever EUR/USD, USD/JPY, and GBP/USD are most actively traded.
The London session and the London-New York overlap are by far the most liquid and most volatile windows, accounting for the bulk of daily DXY range. Asian-only hours can produce sharp moves on BoJ statements (USD/JPY is the second-largest basket weight) but spreads tend to widen.
Asia (roughly 18:00 to 03:00 ET)
Quieter ranges. The main risk event is the Bank of Japan, which has been the most consequential non-Fed central bank for DXY in recent years because of its yield-curve control regime. A BoJ shift can move USD/JPY by 2 to 3% intraday and push DXY by 0.3 to 0.4% on its own.
London open (roughly 03:00 to 08:00 ET)
Liquidity ramps up as European desks come online. Eurozone CPI, PMI flashes, ECB meetings, and ECB speeches print in this window. Given the 57.6% EUR weight, this is where most DXY trends actually start. Spreads on DOLLAR at LHFX tighten meaningfully once London opens.
London + NY overlap (roughly 08:00 to 12:00 ET)
The most liquid four hours of the day. US data releases (NFP, CPI, PCE, retail sales) print at 08:30 ET. FOMC decisions are released at 14:00 ET with the press conference at 14:30 ET. Most multi-percent DXY days are made or broken in this window.
NY afternoon (roughly 12:00 to 17:00 ET)
Activity tapers after the European close at 11:30 ET. FOMC days are the exception: the 14:00 statement and 14:30 press conference regularly produce 0.5 to 1.5% intraday DXY moves in a 60-minute window.
Daily DXY ranges are typically 0.3 to 0.8%. FOMC, NFP, and major ECB or BoJ event days routinely produce 1 to 2% ranges. Sizing should reflect the calendar, not the average.
What moves DXY day to day
DXY is a basket of six FX rates, so the catalysts are whatever moves those six pairs. Because EUR/USD is 57.6%, anything that hits EUR/USD shows up immediately on the DXY chart. The other five components matter when their respective central banks surprise the market.
Federal Reserve policy
The single biggest DXY driver. Hawkish surprises (faster hikes, slower cuts, terminal rate revisions higher in the dot plot) lift the dollar against the entire basket. The FOMC meets eight times a year, with dot-plot updates in March, June, September, and December. FOMC days routinely deliver 1 to 2% intraday DXY ranges.
EUR/USD and the ECB
Because EUR is 57.6% of the basket, a 1% move in EUR/USD produces a 0.55 to 0.6% move in DXY in the opposite direction. ECB rate decisions, Eurozone HICP releases, PMI flashes, and Lagarde press conferences are second-tier DXY events in label only. In practice they often move DXY more than US data.
US macro data
Non-Farm Payrolls (first Friday of each month, 08:30 ET), CPI (mid-month), PCE (end of month, the Fed's preferred inflation gauge), ISM PMIs, retail sales, and JOLTS job openings all move DXY through the rate expectations channel. Surprises of 2 standard deviations or more typically deliver 0.5% same-day DXY moves.
Global risk sentiment
DXY tends to rise during risk-off episodes (capital flight into US Treasuries: 2008, March 2020, banking-stress weeks) and weaken during sustained risk-on periods when investors chase yield outside the US. The dollar's safe-haven character competes with the basket's EUR exposure during European-led crises.
Cross-currency central banks (BoJ, BoE, SNB)
Bank of Japan policy shifts move USD/JPY (13.6% of the basket). Bank of England decisions move GBP/USD (11.9%). Swiss National Bank interventions can move USD/CHF abruptly (3.6%, but high-vol when it triggers). These can shift DXY without any Fed-side trigger, which catches out traders who treat DXY as a pure Fed proxy.
Geopolitics and capital flows
Wars, sanctions packages, sovereign-debt scares, and major elections drive cross-border flows into or out of the dollar. The 2022 European energy crisis, for example, pushed DXY to a 20-year high above 114 as EUR/USD broke parity. Long-dated geopolitical themes tend to set the multi-month DXY trend rather than the daily range.
DOLLAR CFD vs DX futures vs UUP ETF
You can take a view on DXY three ways: the DOLLAR CFD at LHFX, the ICE DX futures contract, or the Invesco UUP ETF. They reference the same calculation but trade very differently.
| Product | Expiry | Smallest size | Cost structure |
|---|---|---|---|
| DOLLAR CFD (LHFX) | None (spot, perpetual) | Fractional lots on MT5 | Spread + $3 per side commission + overnight swap |
| DX futures (ICE) | Quarterly (Mar, Jun, Sep, Dec), must roll | 1 contract = $1,000 x DXY (notional approximately $104,000 at 104) | Exchange fees + broker commission + roll cost |
| UUP ETF (Invesco) | None (equity wrapper) | 1 share | Bid-ask + 0.77% annual expense ratio |
For active traders, the DOLLAR CFD is the most flexible route: fractional sizing on MT5, no expiry to roll, 23-hour access, and leverage up to 1:200. The DX futures contract has lower spread for institutional size but requires quarterly roll and a six-figure notional per contract.
UUP is a buy-and-hold equity wrapper. It pays no dividend, charges 0.77% per year, and only tracks long-DXY exposure (there is a separate inverse ETF, UDN). For a short DXY view on margin, the CFD is the cleanest single instrument.
Trading DOLLAR at LHFX
LHFX offers DXY on MT5 under the DOLLAR symbol with STP/ECN execution and no dealing desk. Specifications are visible inside MT5 under Market Watch, Symbols, DOLLAR.
Up to 1:200 on DOLLAR. DXY moves less than equity indices on an average day, so 1:30 to 1:50 effective leverage is typical for experienced traders; 1:200 into an FOMC release is full-account risk.
$3 per side ($6 round-trip), applied per standard lot, identical for buys and sells.
MetaTrader 5 on Windows, Mac, web, iOS, and Android. LHFX is a direct MetaQuotes licensee.
STP/ECN. Orders route to aggregated bank and non-bank pricing, not an in-house dealing desk.
Sunday 17:00 ET to Friday 17:00 ET, with a short daily break around 17:00 ET.
For the live spread snapshot, contract size, and full specifications, see the DOLLAR instrument page. For commissions and spreads across every instrument, see spreads and fees, and for leverage caps by asset class, see leverage.
Risks of trading DXY
DXY looks calm on a daily chart compared to gold or crypto, but the combination of FOMC surprise risk and a basket math that few retail traders fully internalise means losses can compound faster than the average daily range suggests.
FOMC surprise risk
Average DXY days are 0.3 to 0.8%. FOMC release days regularly produce 1 to 2% intraday moves inside a 60-minute window after the 14:00 ET statement. At the 1:200 leverage cap, a 0.5% adverse move wipes your full margin on the position. Most retail accounts that take big DXY losses do so by sizing for the calm-day range and then meeting an FOMC day at full exposure.
Basket composition quirks
DXY can disconnect from EUR/USD when a smaller basket component has an outsized move. The SNB's January 2015 removal of the EUR/CHF floor sent CHF higher by over 20% in minutes and produced a DXY spike that pure EUR/USD watchers did not anticipate. BoJ surprises that move USD/JPY 2 to 3% on a day when EUR/USD is flat have a similar effect. Reading DXY as just inverse EUR/USD is the most common interpretation error.
Leverage amplifies both directions
At 1:200 leverage, a 0.5% adverse DXY move on a fully-loaded position costs your entire margin. A 1% adverse move is double your margin. The same mechanism that makes a 1% favourable move return 200% on margin makes a 1% adverse move a total loss plus margin call. Size positions to your account, not to the leverage cap.
Single-theme concentration
Holding only DXY exposes you to one macro theme: dollar policy versus the rest of the developed world. Diversification across uncorrelated instruments (gold, commodity FX, equity indices) reduces the impact of any single thesis being wrong about Fed or ECB direction.
Risk disclosure: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Never trade with money you cannot afford to lose.