Using nano

Start a Bash session in your container

docker exec -it <containername> bash

and run the command

export TERM=xterm

Now you can start and use nano

nano <file>

As well as jed if you are more familiar with Emacs-like bindings.

jed <file>

To make this setting permanent edit the _.bashrc_ file in the container

cd /root
nano .bashrc

Insert the line

export TERM=xterm

before the comment

# set a fancy prompt (non-color, unless we know we "want" color)

Your next Bash session has colored output in the command line interface (e.g. with the ls command) and nano starts without fiddling.