US Dollar vs Chinese Yuan and Russian Ruble — Structural Technical Outlook

When I was evaluating the basket of global currencies at the end of 2025, I noted very unusual and very powerful signals that both the Chinese Yuan and the Russian Ruble had made. They both formed annual Bullish Engulfing patterns against the US Dollar. During the first two months of 2026, the currencies were likely developing a foundation, and in March they started to show strong technical signals supporting a bullish development against the US counterpart. It now looks like it is time to run a technical analysis.

USD vs CNY

The U.S. Dollar is aggressively losing value against the Yuan. The pair has lost multiple important supports, including the 100-month MA, and is moving toward the 200-month MA. While the smaller frames have been oversold, the attempt at a reversal does not look constructive. Most likely, the Dollar will continue its bearish path.

After the recent bearish quarters, the pair has invalidated almost all options for developing an impulsive structure upward. I view the formation, best seen on the quarterly chart, as a potential bearish flag that was possibly completed about a year ago, in April 2025.

The pair is approaching a critical inflection zone of 6.60–6.80. If this level is broken to the downside over the next few quarters, it could open a path toward 5.17, implying a potential decline of roughly 25% from the current level of 6.88. The timing is broad and could span from several years to a decade.

It is important to note that several key confirmations are still pending, and this outlook should be considered preliminary.

RUB vs USD

USD/RUB has been taking a different path following the annual signal. The pair has backtested major supports on several long-term frames since January and has been moving strongly higher since mid-March. The technicals have started to align for a rally in the ruble, and the move has been constructively impulsive.

If this intent is confirmed, the rally could be outstanding. The pair may have formed a significant flag. Should this formation be confirmed in the coming months, the ruble could potentially double its value against the Greenback over the next few years.

From an Elliott Wave perspective, considering a very long correction that began with an impulse down in 2022, the most typical projection for wave C could drive the ruble into the 11.50–34 range against the Dollar over 5-10 years.

While many will view this projection with a healthy dose of skepticism, it is not the first time that Elliott Waves have helped project rather large swings in the USD/RUB pair. In 2020, when the Dollar was around 75, I projected a move to 100 against the ruble by March 2022. In March 2022, the Dollar reached 154 and formed an Ending Diagonal with the base at 55. The next projection was a return to the origin of that diagonal. The Dollar did exactly that, dropping just below 55 in the following months.

Below are the charts confirming these calls.

RUB vs CNY

But now comes the most interesting part. Many would expect the ruble and the yuan to move in unison against the US Dollar. The reality, however, is quite different. On the same annual frame, the ruble formed a Bullish Engulfing against the Chinese Yuan. This is also a powerful signal. However, as the pair is relatively new and the data sets are limited, it is challenging to assess the long-term dynamics and provide a reliable outlook.

To better understand this unexpected strength of the ruble against the US Dollar, the yuan, the euro, and a broader basket of currencies, I conducted a background review of the underlying drivers.

Transformation of Ruble

The recent strength of the ruble cannot be fully explained through the traditional lens of a commodity-driven currency. While energy remains an important component, Russia’s export structure has evolved into a far more diversified system, spanning agriculture, fertilizers, metals, and other essential goods. This places the country at the center of multiple critical supply chains, where demand is driven not by discretionary consumption, but by necessity.

At the same time, a more important shift is taking place in how these exports are being settled. An increasing share of trade is now conducted in rubles and local currencies, reducing reliance on the US dollar. This transition is not limited to energy flows but extends across a broad range of exports, indicating a structural change in global settlement behavior rather than a cyclical adjustment.

This has direct implications for currency dynamics. When trade is settled in a currency, demand is created through payment obligations rather than through capital flows or speculation. If that currency is also subject to limited external circulation, the result is a combination of steady demand and constrained supply. Under such conditions, strength can develop independently of traditional macro drivers.

In this context, the ruble is beginning to behave less like a commodity proxy and more like a settlement-backed currency tied to a diversified basket of real-economy flows. This helps explain why it can strengthen not only against the dollar but also against the yuan, highlighting the absence of a unified alternative system and pointing instead to a fragmented and evolving structure.

These developments provide a fundamental backdrop to the technical signals discussed above. While the outlook remains preliminary and requires further confirmation, the alignment between emerging settlement dynamics and long-term technical structures suggests that the recent moves may not be isolated, but part of a broader transformation still in its early stages.

SUMMARY

The recent strength of both the Chinese Yuan and the Russian Ruble is becoming increasingly aligned with the technical signals observed on the largest time frames. In the case of USD/CNY, the Dollar has lost key long-term supports and is approaching a critical inflection zone, suggesting a potential structural shift rather than a short-term move. The broader trend points toward a gradual appreciation of the Yuan against the Dollar.

At the same time, the ruble’s strength appears to be supported by a deeper transformation in trade and settlement dynamics. With a diversified export base and an increasing share of transactions conducted in rubles and local currencies, demand is being driven by payment obligations rather than traditional capital flows. Together, these developments help explain the technical setups across USD/RUB and USD/CNY and suggest that the recent moves may reflect an early stage of a broader structural transition rather than isolated currency fluctuations.