Load the data: This step involves loading the stock price data into the Python environment. This can be done using libraries like pandas or yfinance.
Store the data into a df: The stock price data is typically stored in a pandas DataFrame for analysis.
Set the date to be the index and show the date: This step involves setting the date column as the index of the DataFrame and displaying the index to confirm that it has been set correctly.
Visually show the stock price: This step involves using a library like Matplotlib or Plotly to plot the stock price data over time.
Calculate the MACD and signal line indicators: The Moving Average Convergence Divergence (MACD) is a technical indicator that is commonly used in stock analysis. It is calculated by subtracting the 26-day exponential moving average (EMA) from the 12-day EMA. The signal line is a 9-day EMA of the MACD line.
Calculate the short-term EMA: This step involves calculating the short-term EMA, which is typically a 12-day EMA.
Calculate the long-term EMA: This step involves calculating the long-term EMA, which is typically a 26-day EMA.
Calculate the MACD line: The MACD line is calculated by subtracting the long-term EMA from the short-term EMA.
Calculate the signal line: The signal line is a 9-day EMA of the MACD line.
Create a function to signal when to buy and sell an asset: This step involves creating a function that takes in the MACD and signal line values and returns a buy or sell signal based on when the MACD crosses above or below the signal line
create buy and sell column:Create a new column called "Buy/Sell" and populate it with "Buy" or "Sell" signals based on the MACD and signal line crossovers.If the MACD line crosses above the signal line, mark the corresponding row with a "Buy" signal. If the MACD line crosses below the signal line, mark the corresponding row with a "Sell" signal.
visually show the stock buy and sell signals: To visually show the stock buy and sell signals using MACD, you can plot the stock price chart along with the MACD and signal line. You can also plot the MACD histogram to better visualize the strength of the trend.