First you must install python extension with jupiter tools and editor by link or inside the editor

Further you must create your env
in your project folder and activate it and install ipykernel
module by env pip
# python3 -m venv venv
# source ./venv/bin/activate
(venv)# pip install ipykernel
Now we can create new kernel
for our juputer documents
(venv)# python3 -m ipykernel install --user --name='algorithms'
Now go to our docs and do change interpreter and you can see our kernel by name. Do select it

Now it works great. Good luck!

How to using python venv environment for VS Code Jupiter extension