A *sideways market* (also called a *horizontal market*) is a market condition where the price of an asset moves within a relatively narrow range, showing no clear long-term upward or downward trend. In this situation, the price fluctuates between well-defined *resistance* (upper boundary) and *support* (lower boundary) levels, as shown in the image.
During a sideways market, investor sentiment is often uncertain or neutral. Buyers and sellers are evenly matched, causing the price to bounce back and forth within the range. This type of market can last for days, weeks, or even months, and usually appears during periods of consolidation after a strong trend.
Traders often use **range trading strategies** in sideways markets. They buy when the price approaches the support level and sell when it nears the resistance level. Technical indicators like *RSI*, *MACD*, and *Bollinger Bands* can help confirm entry and exit points.
A breakout above the resistance or a breakdown below the support often signals the end of the sideways trend and the beginning of a new directional move. Recognizing a sideways market is essential for adjusting trading strategies and managing risk effectively. It's especially useful for short-term traders looking to profit from predictable price swings.
