Digital pen using interferometry for relative and absolute pen position

A digital pen that has an ink writing tip includes a laser on a pen body that directs light toward paper across which the writing tip is stroked. A diffraction grating reflects a reference beam and passes a scattered beam from the substrate toward translation detectors, which consequently receive interference patterns of light. A processor receives the signals from the detectors, generates position signals, and stores the signals. Also, a bar code detector receives a bar code beam from the substrate, and a three dimensional force sensor outputs a signal representative of multidimensional forces applied to the pen. Subsequently, the signals are uploaded to a host processor which combines them to produce rotation-corrected relative positions (if no bar coded paper is used) or rotation-corrected absolute positions (if bar coded paper is used) that can be used to render alpha-numeric characters or graphical representations.