Welcome to Salehoo!
Niche means, in this business, an item which not many, or any are selling that has a public. For example, let's pick collectible coins. Lets say someone has a custom coin holder that no one else is selling. Now they could list under the coin auctions their coin holder. Say it has some feature no other holder has such as an interchangeable coin slot where any size coin would fit. (Just making this up as I go.) Then maybe all the coin buyers would want it. What would make it even more of a niche is if this seller was making the item. That would mean no other buyer could source this item. So until another seller makes a similar item the original seller would have cornered the market. Any buyer that wants this item would have to purchase from him.
In searching for products to sell, you need one very handy piece of software
found here Link hidden: Login to view
You will then be able to take any product and see if you can compete on eBay.
Once you find the product you then have to make sure the source is legit which you can do right here on Salehoo by asking. After awhile you will learn to do your own research as well.
One final word of advice is to never take a reference as fact from anyone but do your own research to see if you really can make a profit with the above tool.