In March 1768, Ming Rui began his retreat, pursued by a Burmese army of 10,000 men and 2000 cavalry. The Burmese then tried to encircle the Chinese by splitting the army into two. Maha Thiha Thura had now assumed the overall command, replacing Maha Sithu. The smaller army, led by Maha Sithu, continued to pursue Ming Rui while the larger army led by Maha Thiha Thura advanced through the mountainous route to emerge directly behind the Chinese. Through careful maneuvering, the Burmese managed to achieve complete encirclement of the Chinese at modern-day Pyinoolwin , about 50 miles northeast of Ava. Over the course of three days of bloody fighting, the Bannerman army was completely annihilated. The slaughter was such that the Burmese could hardly grip their swords as the hilts were slippery with enemy blood. Of the original 30,000 men of the main army, only 2500 remained alive and were captured. The rest had been killed either on the battlefield, through disease or through execution after their surrender. Ming Rui himself was severely wounded in battle. Only a small group managed to break through and escaped the carnage. Ming Rui himself could have escaped with that group. Instead, he cut off his queue and sent it to the emperor as a token of his loyalty by those who were escaping. He then hanged himself on a tree. In the end, only a few dozen of the main army returned.

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