In this article we are going to discuss non-directional markets, their sources as well as what to do with them. First, however, we need to define them.
So what is a non-directional market?
Imagine you're trading the EUR/USD. After you perform some market analysis, you belive that the currency pair is going to strengthen so you go long on the EUR/USD. Another day, you might believe that it is going to drop, so you would short the currency pair. These would be an example of directional trading because the trader is taking a fairly confident stance on which direction the trend is going to go. In non-directional markets, you'll notice that the trend doesn't take a clear stance; rather, it moves sideways.