In Christ and Christ in You

From Anstey’s Doctrinal Definitions:

These are technical expressions used by the Apostle Paul to denote the Christian’s standing and state.
"In Christ" is a positional term denoting the Christian's link with Christ in the very place of favour that He is in before God. Literally, it means to be “in Christ's place before God” (Rom. 6:11, 23; 8:1, 39, etc.). This place has been secured for us through Christ’s rising from the dead and His ascending to God’s right hand as a glorified Man. It is a position that belongs to every believer on the Lord Jesus Christ regardless of what his or her state of soul may be because it has to do with the Christian’s standing before God that never changes. Even if a Christian dies, he is still viewed as being “in Christ!” (1 Thess. 4:16; Rom. 8:38-39) It is our connection with Him as Head of the new creation race, of which we are His “many brethren” (Rom. 8:29; 2 Cor. 5:17). Thus, the term denotes the special standing that Christians have which Old Testament saints didn’t have, for in their day Christ had not yet come, nor had He ascended on high as a glorified Man. In fact, all of our distinctive Christian blessings are said to be "in Christ." (See Blessing.)
"Christ in you" is a term that many Christians have generally misunderstood. They think that it means that Christ personally dwells in them. Hence, comes the often-heard statements, "Christ dwells in me," or "Jesus lives in me!" While it is true that the believer is indwelt by a divine Person, it is not Christ who dwells in us, but the Holy Spirit (John 14:17; Acts 5:32; Rom. 5:5; 1 Cor. 6:19; 1 Thess. 4:8; James 4:5; 1 John 3:24). It has not helped that modern evangelists have popularized phrases such as: "Open your heart and let Jesus in," and "Ask Jesus to come into your heart," etc. Scripture does not support the idea that there are two divine Persons dwelling in the Christian. It is true that He is omnipresent (an attribute of deity) and is everywhere in spirit, but He personally resides in His own glorified human body in heaven.
Certain passages of Scripture say: "I am crucified with Christ: nevertheless I live; yet not I, but Christ liveth in me: and the life which I now live in the flesh I live by the faith of the Son of God, who loved me, and gave Himself for me" (Gal. 2:20). "Christ in you, the hope of glory" (Col. 1:27). "He that eateth My flesh, and drinketh My blood, dwelleth in Me, and I in Him" (John 6:56). "In that day ye shall know that I am in My Father, and ye in Me, and I in you" (John 14:20). These passages are not referring to Christ personally dwelling in believers, though it is understandable how a person could mistakenly conclude that from them. Rather, they are referring to a subjective state in believers, resulting from them having the life of Christ. These verses are simply stating that we have His very life and nature in us, and therefore, the capacity to have His moral features formed and displayed in us by the Spirit (2 Cor. 3:18). Hence, Christ is in us morally, but not personally. Colossians 1:27 is referring to it in a collective sense—of which “you” denotes (in the KJV). Commenting on this verse, W. Kelly said, "It is Christ's life in us in its full risen character of display" (Lectures on Colossians, p. 108). Another expositor has said, "The mystery in Colossians is said to be 'Christ in you, the hope of glory' as having a present effect in the reproduction of the features of Christ in the Gentiles" (Precious Things, vol. 3, p. 201). Hence, Christ is with us in spirit—being an omnipresent Person (Matt. 18:20; 28:20; Heb. 13:5), but He doesn't dwell in us personally, as does the Holy Spirit.