After an awful performance in 2022, cryptocurrencies are celebrating the New Year by exploding higher. Are these moves sustainable? If so, which crypto has the most potential? Let's go to the charts to find out.

Bitcoin (BTCUSD)

Last year, bitcoin disappointed investors, losing 81% of its value. The digital currency started 2022 above $50,000 and ended the year near $16,500.

This year is proving to be a different story. Just two weeks into 2023, bitcoin has gained nearly 30%. There was a dramatic pickup in both price and volume late last week (shaded yellow). By Monday, bitcoin had reached a two-month high.

Source of charts: TradeStation

Bitcoin's next major resistance appears at $22,800 (point A) in the form of its 200-day moving average (red). Above that level, there is significant resistance near $28,000 (point B). That area acted as support in May and June of last year (black dotted line).

Ethereum (ETHUSD)

After gaining 469% in 2020 and 399% in 2021, ethereum opened 2022 above $3,800. By year end, the programmable digital currency traded below $1,200 for a loss of 68%.

Ethereum appears to be even better positioned to continue its rally than bitcoin. Ethereum challenged its 200-day moving average (point A, red) on Monday before pulling back.

A break above that key indicator would open the door for a move to $1,783 (point B, black dotted line). This represents a gain of about 13% from Monday afternoon's high. On Friday, ethereum saw its highest volume in two months (arrow).

Litecoin (LTCUSD)

This may come as a surprise, but litecoin is stronger than both bitcoin and ethereum. The digital currency, which was designed as a peer-to-peer payment network, began its current rally in early November, well before both bitcoin and ethereum.

Litecoin is trending higher within a bullish channel (parallel lines). On Monday, the cryptocurrency touched $89.21, an eight-month high.

Litecoin trades well above its 50-day (blue) and 200-day (red) moving averages. Litecoin's 50-day MA crossed above its 200-day MA at the start of the year, a sign of bullish momentum.

Why has crypto suddenly roared back to life? Opinions vary, but there is a sense of relief among crypto investors. There was fear in the industry that the FTX fraud and collapse would lead to a string of subsequent failures. For now, there is a sense of what passes for stability in the world of crypto.

It should go without saying, be very cautious in the world of crypto. The highly speculative nature of this unregulated market can lead to both large gains and large losses.

At the time of publication, Ponsi had no positions in the cryptocurrencies mentioned.