The euro may decline to a two-year low after it reaches the upper range of its so-called downward channel, Forecast Pte said, citing trading patterns. The 17-nation currency is in the channel, which has a top line demarcated by highs of $1.4549 on Aug. 29, 2011 and $1.4247 on Oct. 27, said Pak Lai Ng, a Singapore-based technical analyst at Forecast. The bottom line of the channel runs through the low of $1.3146 on Oct. 4. The single currency has never climbed above the channel, and its upper limit was about $1.2674 today, according to data compiled by Bloomberg. The euro dropped 0.3 percent to $1.2535 as of 10:38 a.m. in Tokyo from the close in New York yesterday. Europe’s single currency has risen 4 percent since it touched $1.2043 on July 24, the lowest level since June 2010. The euro is “only correcting up,� Ng said. “After the correction, it should head back down again to retest� the July 24 low, he said. In technical analysis, investors and analysts study charts of trading patterns to forecast changes in a security, commodity, currency or index. To contact the reporters on this story: Sharon Chen in Singapore at schen462@bloomberg.net; Shigeki Nozawa in Tokyo at snozawa1@bloomberg.net To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net

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