dognovel Chapter 327 The First Candlestick Chart in American History
Chapter 327 The First Candlestick Chart in American History
Chapter 327 The First Candlestick Chart in American History
At 1 p.m., Mr. Porter had already gathered all the sales staff in the sales department lobby for a performance review meeting.
The sales staff attending the meeting were quite puzzled, as this meeting was usually held at 6 pm on Saturdays.
For some reason, it started at noon today.
Some quick-thinking employees had already considered a possibility: they believed that Mr. Porter, the general manager of the sales department, would be going on a long trip in the afternoon, so they called the meeting in advance.
This means that employees can have a very pleasant afternoon without being constrained.
Meanwhile, Matthew had already placed ten sheets of the widest logarithmic graph paper in the lobby of the second-floor conference room.
Larry, with a smile on his face, stood up and bent down to look at the precious blueprints.
Matthew was a little puzzled. The pile of papers on the table was covered with densely packed horizontal and vertical grid lines. These were imported from Germany, with ten grids per inch. The vertical axis was the scale for reference, and the horizontal axis was for time.
This type of paper is occasionally used in industry for design and engineering calculations, and is also used occasionally in teaching.
But I've never heard of anyone on Wall Street using this.
But Larry in front of him had an eager look on his face.
"Are you going to draw it now?" Matthew asked in a low voice, a hint of doubt in his tone.
Larry held a thick stack of stock quotes in one hand, while his other hand had already pulled out red and blue pencils, a ruler, and an eraser from his pocket.
"Of course, I'm going to draw now! Oh, no, not draw, I'm going to see." Larry smiled and waved the red and blue pencils and ruler in his hand. "I had the clerk in the sales department buy them. Look, I've got everything ready, the pencils are all sharpened to a fine point—"
Matthew gave a wry smile. "I don't understand, what do you need this thing for? We use it occasionally when designing firearms, but how are you going to use it to represent stock prices?"
"Wait, you'll see—" Lali carefully calculated the stock price fluctuation range by spreading a logarithmic graph on the table, leaving enough space above and below, before solemnly drawing the first line in red pencil in the middle—
Larry's movements were slow and precise, as if he were performing some kind of religious ritual.
Matthew, very curious, stood by the table with his hands in his pockets, watching Larry draw. Larry looked up and said, "My brother, buy me some hot dogs first. I didn't eat lunch—you probably didn't either, right?"
"Oh, okay!" Matthew glanced back curiously before walking out to the street to buy lunch for the two of them.
Larry was left alone in the room, and he was drawing the first candlestick chart in American history.
To be precise, Larry didn't draw a Japanese-style candlestick chart, but rather a variant of it—the bamboo-shaped chart.
Prices are represented on a logarithmic scale, with vertical lines representing the daily high and low prices, and horizontal lines marking the opening and closing prices.
第一根线，1892年1月2日，开盘价1又3/4美元，最高价1又7/8，1又1/2最低价，收盘价还是1又3/4美元。
"The first day is a cross—" Larry muttered to himself.
第二根线，股市1度冲破了两美元，达到2又1/8美元，但尾盘又收回了两美元之下的1又7/8美元。
The third one, the fourth one —
Larry drew along the grid of the diagram. His hand was as steady as a pendulum, each stroke landing precisely on the logarithmic scale.
As the lines extend, a strange rhythm emerges: during declines, the lines are steep like a precipice; during consolidation, they are dense like a silkworm cocoon; and during rebounds, they stretch out like an oak tree.
When Matthew returned to the room with lunch, he saw a series of red vertical lines spiraling upwards, like an unstoppable tide!
"My God, what kind of chart is this?" Matthew asked in surprise.
「这是美国菸草从3月初的那波攀升，从二又1/4美元一口气爬升到四又3/8美元价格几乎翻倍！」拉里直起脊背，笑着回答道。
"Wait, let me see." Matthew piled his lunch on the table, bent down, and looked at it seriously.
The first thing he noticed was the numbers on the horizontal axis on the left side of the chart that represented the stock price. Then he looked at the time marked on the vertical axis below and it was easy to understand that this was the price trend for the day.
"I can tell this represents price, but what is this horizontal bar?" Matthew asked, pointing to the candlestick chart.
"The horizontal bar to the left of the vertical line represents the opening price, and the horizontal bar to the right represents the closing price for the day!" Larry explained.
Matthew's eyes narrowed as he stared intently at the simple chart. He exclaimed in surprise, "—So this very simple chart, with two horizontal lines and a vertical line, represents the price for that day? If I'm not mistaken, the highest point of the vertical line should be the stock's highest price for that day—"
"Smart! The lowest point is the lowest price of the day —" Larry said with a smile.
"My God, I've never seen or heard of such an expression before! But Larry, why did you list these four prices?"
Larry smiled and picked up a thick stack of transaction records, flipping through a dozen or so transaction reports for the day, saying, "You can think of NYSE stock trading as a war, where two armies start attacking each other from a certain front, and the front changes according to the strength of the bulls and bears, until the closing price, where the final price represents the final result reached by the two sides that day."
Matthew didn't understand stocks, but he had experienced some stock trading with Larry, so after thinking about it for a while, he gradually understood Larry's intention.
"So, you think the most important price of the day is the closing price —"
"Yes, that's the closing price! It's the result of a day's battle between the bulls and the bears, and it also symbolizes the ebb and flow of power between the two sides—" Larry replied.
"If I'm not mistaken, you mean that this kind of chart can be used to easily memorize the daily stock price trends, which can show the changes in the power of those buying and selling stocks—" Matthew still had doubts in his eyes.
Larry then drew a curve in a one-inch square table below the chart. "You see, this represents today's price movement. The leftmost end of the curve is the opening price, and the top of the curve during the session is the day's high—it was originally a curve, a two-dimensional one. Let me condense it."
Matthew looked at the chart for a while, then suddenly realized. "I get it—for you, a chart like this can record stock prices for weeks or months, but why bother drawing a chart? Wouldn't it be better to just create a table and fill in the prices?"
"6
Larry thought to himself that people who don't understand really can't explain it; he couldn't see how much potential there was in charting stock prices.
Only those who know their stuff can tell the difference.
Larry ignored his meal and continued drawing, while Matthew ate a hot dog and stood by watching.
Just then, Mr. Porter finished his meeting. When he announced that all the sales department employees would have the afternoon off, everyone looked at each other in disbelief at first, then happily rushed to leave work, afraid that the boss would change his mind.
Mr. Potter pushed open the door with curiosity and immediately saw Larry's strange chart.
Unlike Matthew, Mr. Porter spent his entire life dealing with stock prices. The moment he stared at the chart, his feet were rooted to the spot, and his pupils began to dilate violently.
He immediately recognized the stock price movement of American Tobacco – but he never imagined it would be presented in this way.
The slope of the decline, the arc of the rebound, the density of the consolidation—everything seemed to be compressed into a cruel order.
Those cold, impersonal quotes suddenly seemed to come alive.
"My God! Is this a chart representing stock prices? To present the daily stock prices in such a way, my God! What a brilliant idea!"
When Mr. Potter sighed, his tone was sharp and even a little shaky.
Matthew turned to look at Mr. Potter with curiosity and asked, "It's like this, this records the price movement of a stock over many days, such a record is very vivid—but you don't need to be so shocked, do you?"
"—No! It's not that simple!" Mr. Potter trembled as he took a few steps forward, his eyes fixed on the coordinate paper on the table as if gazing into an abyss.
"This is a completely new way of expressing things, turning those rigid numbers into graphics, making the stock price movements over weeks and months crystal clear. Wait, what do these horizontal bars represent?"
Mr. Potter reached out and touched the drawings, as if to confirm that the diagrams were not an illusion.
Larry then explained the meaning of the vertical and horizontal lines to Mr. Potter in detail.
Mr. Porter remained silent, only nodding repeatedly. After Larry finished speaking, his gaze was already fixed on the decline in American Tobacco's stock price after Larry's purchase—
It was an extremely steep and rapid decline, with the stock price falling from four dollars to around two dollars before stopping, and then rebounding to above three dollars.
Mr. Porter swallowed hard, as if he could see from the simple charts that two armies were locked in battle, and that the bears' breakthrough had caused the bulls' front to collapse.
Numerous long positions began to liquidate, and the selling pressure from these liquidations caused the stock price to fall further.
Mr. Porter could even picture the anxious expressions on the faces of those clients who were rushing to close their positions.
With his gaze fixed on the last candlestick, Mr. Porter tapped his finger heavily on the empty space behind it.
"The stock price will rebound—but not for long; it will continue to fall afterward!"
Larry smiled without saying a word, while Matthew asked incredulously, "Why? I don't see it?"
Is this a prediction? Or did you already know what would happen next?
Mr. Porter stared intently at the chart, waiting for a long time before finally muttering, "That must be it. I don't know the subsequent price. I haven't paid attention to specific stock price changes for a long time since I stopped being a trader, but this is all obvious."
"Is it a premonition?" Matthew asked, frowning.
Mr. Porter looked up, staring intently at Matthew until Matthew felt a chill run down his spine, before speaking seriously, "—This isn't a prediction; it's far more terrifying than a prediction. This is the most important word in the stock market—trend!"
As he spoke, Mr. Potter turned to look at Larry, his gaze serious and sharp, as if he were seeing Larry for the first time.
"Mr. Livingston! Is this what you meant by the secret of the deal?"
As he spoke, Mr. Potter's lips trembled slightly.