Sherlock Holmes A Study in Scarlet

A Study in Scarlet is the first story to feature the iconic detective Sherlock Holmes. In this clip, he is shown inspecting the scene of a murder.

After a careful yet brief assessment of the situation, he is able to tell the police a great deal of information about the perpetrator. Holmes deductive feats are a remarkably complex mental act. What is deductive reasoning? What is inductive reasoning? Does Holmes use both in this scene? How?