Algorithmic Trading with MACD in Python
A step-by-step guide to implementing a powerful strategy
Introduction
In the previous article of this algorithmic trading series, we saw how Bollinger bands can be used to make successful trades. In this article, we are going to discover yet another powerful technical indicator that is considered to be one of the most popular among traders. It’s none other than Moving Average Convergence/Divergence (MACD). We will first understand what this trading indicator is all about then, we will be implementing and backtesting a trading strategy based on this indicator in python to see how well it’s working in the real world. Let’s dive into the article!
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MACD
Before moving on to MACD, it is essential to know what Exponential Moving Average (EMA) means. EMA is a type of Moving Average (MA) that automatically allocates greater weighting (nothing but importance) to the most recent data point and lesser…
