February 9, 2026

Preview from my weekly report*

Our Colby CDT program outperformed the S&P 500® Index in 2025 and in 2026 so far. All of our asset management clients have made significantly positive relative returns over the past 15 years while taking substantially less risk. We offer complete transparency, anytime access to your funds, and low fees. You keep control over your money. See: ColbyAssetManagement.com

Relative strength has broadened to favor smaller, less-glamorous stocks.

• The broad market for common stocks remains bullish.
• The Dow Theory again confirmed the major bull market trend on Friday, when both the Industrial Average and the Transportation Average rose to new all-time, closing-price highs.
• The Cumulative Daily Advance-Decline also rose to a new all-time high on Friday.
• Net New Highs rose to 284 on Friday, the second-highest level in 52 weeks.
• The financial markets are not all moving together in lock-step uptrends, however.
• Focus on the strong trends and avoid the laggers.
• Relative strength has broadened to favor smaller, less-glamorous stocks, indicated by new highs on Friday for the unweighted S&P 500 Equal Weight ETF (RSP) and the S&P 400 MidCap ETF (MDY).
• The following industry sector ETFs rose to new highs on Friday: XLI, XLE, and XLP.
• Relative strength has been rotating away from last year’s mega-cap, high-tech leaders. There has been a popular perception that AI enthusiasm might be overdone--but short-term correction and consolidation phases for these stocks may prove temporary if company managements can convert their great optimism into actual earnings.   
• Of the S&P 500 stocks, 68.6% are above their trailing 50-day Simple Moving Averages, and 68.4% are above their trailing 200-day Simple Moving Averages. Both rose last week and are near the upper ends of their 52-week ranges.  
• 32 of our 38 major market ETFs are in objectively strong positions, with the 50-day Simple Moving Average (SMA) above the 200-day SMA.
• Investor sentiment fell into the Fear zone last Thursday, when the technology stocks were falling steeply on AI fears. That is bullish, according to The Art of Contrary Opinion.
• International equities (except for China) rose to higher highs in recent weeks, again confirming bullish momentum. Emerging Markets (EEM) and EAFE Developed Markets (EFA) prices both rose to new highs recently and remain bullish. China stocks ETF (FXI) has been struggling since its peak at 42 on 10/2/2025 and  continues to underperform global markets. Avoid FXI.
• The US Dollar ETF (UUP, 27.01) fell to 4-year lows last month on 1/27/2026 and signaled a “death cross” last week—which is recognized when the 50-day SMA crosses below the 200-day SMA.
• Metals look vulnerable. Prices were erratic and narrowly mixed last week on falling trading volume. Silver (SLV) and Copper (CPER) were down moderately but Gold (GLD) and Gold Miners (GDX) bounced slightly. Past history shows that severe crashes following previous big price run-ups are most often followed by further large price declines. Long-term trend followers still have large gains, and prudence requires action to protect those gains. Further weakness below last week’s price lows would confirm the new downtrends. Note that our ranking system depends on moving averages and therefore can lag too far behind current price action when prices suddenly crash following parabolic price rises.
• Proceed cautiously with US bond ETFs demonstrating persistent, lagging price momentum: TLT, TIP, IEF, and AGG.
• Avoid underperforming ETFs in objectively bearish trends (with the 50-day SMA below the 200-day SMA): Bitcoin (IBIT), Agriculture (DBA), Real Estate (XLRE), Crude Oil (USO), US Dollar (UUP), and US Treasury Bond (TLT).

11-Year Outperformance by the
Top 10 Exchange Traded Funds
Weekly Rankings of Major Trend Relative Strength
My weekly Top 10 ETFs ranked by the Major Trend Relative Strength outperformed the S&P 500 by over an 11-year period of real-time weekly tests. Click here for a graph of simulated performance.
Please note that my ETF rankings are available by subscription--NOW WITH A NO-RISK FREE TRIAL.
See The Colby Global Markets Report (click here).

My book was named one of the top investment books by Stock Trader's Almanac. This book also received an excellent review in Futures Magazine.

My ETF Rankings are not investment advice. Rather, they are an objective ongoing research study.

Analysis of market forces may offer a sense of probabilities. But the many variables that can impact market prices are notoriously difficult to predict. And, market analysis is something less than an exact science. So, sound trading tactics are always recommended. See my Money Management Rules.

According to CFTC Rule 4.41, hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown.

Trading and investing involve risk of significant loss. Your use of this site means that you have read, understood, and accepted my Disclaimer.            

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Dow Theory Analysis

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Update on EMA Crossover Signals

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Ranking Indicator Performance to Maximize Profit by using
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Robert W. Colby, CMT,
is a consultant to institutional and private investors and traders, providing regular analytical reports, custom research services, and trading systems tailored to clients' objectives. Clients include the most successful traders and investors in the world. Robert is the author of The Encyclopedia of Technical Market Indicators, which is the standard reference for indicator and trading systems design. Previously, at several large Wall Street firms, Robert worked as a proprietary trader, technical analyst, and fundamental analyst. He also was adjunct professor at New York University and New York Institute of Finance, where he developed new courses on technical analysis and market timing.

Robert W. Colby is a Chartered Market Technician (CMT), an accreditation granted to members by the CMT Association (https://cmtassociation.org/) after demonstrating professional competence and ethics over a period of many years. Robert has been a member since 1980, and he strongly supports the CMT Association's high standards. He also supports the The Technical Analysis Educational Foundation (https://www.taeducation.org/about/), which works to have technical analysis included in the curriculum of major business schools. "The CMT Association is the national organization of investment analysts, stock market analysis professionals, and certified market technicians in the United States."

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Ranking ETFs
"Robert Colby has evolved a system that, while hardly foolproof, is pretty clever," wrote Daniel Fisher, "Surfin' ETFs", Forbes, Investment Guide, Special Issue, June 4, 2007.
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INTERVIEW of Robert W. Colby in Technical Analysis of STOCKS & COMMODITIES magazine, December 2006 issue.
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"Gold's next move: History, logic, and intermarket relationships. See if testing gold's relationship to different markets over a 32-year period provides possible trade signals for the yellow metal."
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"Which gold indicators are best? Divining gold's next move."
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"Applying the Relative Strength strategy to ETFs."
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"PUTTING CANDLES TO THE TEST, How Profitable Are They Really?" by Robert W. Colby, CMT. Published in SFO, STOCKS, FUTURES AND OPTIONS MAGAZINE, Volume 5. No. 8. August 2006, pages 91-94. Please click here to buy this article. (Scroll to bottom of linked page.)

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Active Trader magazine September 2004 interviewed Robert W. Colby. 4 pages. "Robert W. Colby: Technical collector. A discussion with Robert W. Colby about technical trading and his revised Encyclopedia of Technical Market Indicators, Second Edition. By Active Trader Staff."

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