*VIX rising sharply and/or high: Traders are â or are becoming â fearful. *VIX declining and/or low: Traders are â or are becoming â complacent. In the cesspool of human frailties that is the financial markets (at least itâs what makes them move), âfear is goodâ and âcomplacency is bad.â At least generally speaking. Figure 1 â SPX vs. VIX Index (courtesy AIQ TradingExpert) A close look at Figure 1 reveals the concept â when the market sells off, VIX âspikesâ as fearful traders bid up put option prices on SPX which in turn increases the implied volatility of said options (if you want to know the inner workings please consult with my friends at Google).