• More than 200 years ago, during Japan’s feudal era, candlesticks and other charts were drawn by hand. It was a craft. Traders had to represent the price of a commodity (rice, at that time) in the correct and precise form to make decisions with real consequences. Mistakes meant financial losses. Also were used alongside complementary strategies linked to rice and other market factors of that time. All of this old history took place at the Dōjima Rice Exchange in Osaka, considered the world’s first organized futures market.
• These methods were developed and used in Japan for centuries before being shared with the Western world, as they were considered confidential.
• Price has been the primary type of data to which these methods have been applied. Today, in Bitcoin (a new digital commodity), the range of possibilities is much broader, allowing these methods to be applied to a wider set of organic market data beyond price alone.
• The creator of the candlesticks is credited to Munehisa Homma. He kept the method confidential within Japan for years before revealing it in his 1755 book, "The Fountain of Gold - The Three Monkey Record of Money", considered one of the earliest works on market psychology. Homma later became a financial advisor to the Japanese government and was honored with the title of samurai for his contributions.
• It wasn’t until 1986 that the first book on the subject was published in English: “The Japanese Chart of Charts” by Seiki Shimizu, translated by Gregory S. Nicholson. This means this body of knowledge has only formally existed in English for about 40 years.
• Shortly thereafter, Steve Nison, who was among the first to receive the CMT designation, emerged as a key figure in introducing and formalizing these methods for Western audiences. Steve’s client list includes Fidelity, J.P. Morgan, Goldman Sachs, Morgan Stanley, NYSE and NASDAQ market makers, hedge funds and money managers.
