In Chapter 3, Getting to Terms with Commonly Used Functions we learned how to calculate the exponential moving average of stock prices. We will plot the close price of a stock and three of its exponential moving averages. To clarify the plot, we will add a legend. Also, we will indicate crossovers of two of the averages with annotations. Some steps are again omitted to avoid repetition.
Calculate and plot the exponential moving averages: Go back to Chapter 3, Getting to Terms with Commonly Used Functions if needed and review the exponential moving average algorithm. Calculate and plot the exponential moving averages of
9
,12
, and15
periods.emas = [] for i in range(9, 18, 3): weights = np.exp(np.linspace(-1., 0., i)) weights /= weights.sum() ema = np.convolve(weights, close)[i-1:-i+1] idx = (i - 6)/3 ax.plot(dates[i-1:], ema, lw=idx, label="EMA(%s)" % (i)) data = np.column_stack((dates[i-1:], ema)) emas.append(np.rec.fromrecords...