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Watson and Holmes immediately go to the telegraph office, where Holmes sends a message. Then they take a cab to the home of John Rance, the constable who found the body. Along the way, Holmes explains to Watson how he figured out so many details about the murderer. Watson asks many questions about the case. Holmes states that while he doesn’t know all the specifics, he’s confident of the main facts, including that the word rache was a red herring to suggest socialism.
At Rance’s home, Rance shares his tale. He explains that he was walking past the house on his usual late-night beat when he noticed a light in the window. Knowing the house should be empty, he pushed the door open, inspected the house, and found the body. Rance states that he then used his whistle to call for help from fellow constables and chased away a drunk man. Before leaving, Holmes gives Rance a coin for his help and explains that the drunk man was actually the murderer. Alone with Watson, Holmes explains that the murderer came back for the ring and that, if necessary, they can use the ring as bait.
Watson tries to rest but can’t sleep from all the excitement. Later, Holmes shows Watson a newspaper advertisement that he placed for a gold wedding ring found near the scene of the crime. The ad directs the ring’s owner to come to Baker Street that evening. Holmes explains that he acquired a false ring and expects the murderer to come retrieve it. He warns Watson to have his revolver ready, just in case.
While they wait, Holmes receives an answer to the telegram he sent to the United States, which confirms his theory about the case. Shortly after 8:00 p.m., an old woman arrives, claiming that the ring is her daughter’s. Watson hands over the ring, and the woman gives her name and address. When the woman leaves, Holmes quickly follows her, believing that she’s the murderer’s accomplice.
Holmes returns home three hours later, having failed to catch up with the old woman. Holmes reports that he followed a cab all the way to the woman’s address, only to discover that she had previously slipped out of the cab. Further, the house belonged to a respectable tradesman. Holmes deduces by the old woman’s quick actions that she was a young man in disguise and that this man knew he was being followed.
The confluence of art and science is an important theme in Chapter IV, as Watson marvels that Holmes’s deductive reasoning skills allow him to describe the physical characteristics, actions, and even the emotions of the unknown murderer. Indeed, Watson refers to Holmes’s practice in deduction as an “art” and Holmes’s self-regard is reminiscent of an artist exceedingly pleased with his own brilliance. Holmes’s arrogance is almost comical as he brags about being able to distinguish cigar ashes and flushes up “with pleasure” at Watson’s compliments. Holmes regards himself as a storyteller as well, able to weave tales from bare facts. But Holmes also stops short of revealing all, continuing his pattern of maintaining an air of mystery. His description of the problem before them as “a study in scarlet” exemplifies his flair for the artistic, and his urgency in finishing up in time for a violin concert shows just how important art is to him.
In Chapter V, the plot’s rising action adds a new dimension as Holmes’s over-confidence causes a setback in the case. Holmes is so sure he is on the verge of trapping the murderer that he spends the moments leading up to the visitor’s arrival idly ruminating on an old book he found. But when an old woman appears instead of their “man” as Holmes had expected, Holmes is shocked. His overconfidence has thrown Holmes off his game and he doesn’t realize in the moment what he later learns: the “woman” is actually a young man who has given Holmes the slip. This incident shows that Holmes finally has a case that challenges his brilliance and an adversary that may be his match.