NEW YORK (MarketWatch) — Long-term Treasury prices rallied Thursday, shrugging off strong data points as the tone of the market continued to be dominated by technical positioning. Solid numbers for consumer prices, jobless claims, and New York-area manufacturing sent yields higher in the immediate wake of the release. But as investors closed out short positions by buying back into the market, yields quickly reversed course, and continued to gain after softer numbers.

 The benchmark 10-year note (10_YEAR) yield, which drops as prices climb, fell 5.5 basis points to 2.489%, setting a fresh seven-month low on a closing basis. The benchmark yield had climbed to an intraday high of 2.557% after some strong data, but retreated quickly afterward, according to Tradeweb.

 Investors have been expecting rates to rise for much of the year, and have done so by accumulating short positions. Investors close out those positions by buying into the market, thereby sending yields lower. After rates initially rose Thursday, investors covered, sending yields lower, according to Thomas di Galoma, head of fixed-income rates at ED&F Man Capital Markets, who said the “market is completely off sides.”

 The 30-year bond (30_YEAR) yield dropped 6 basis points to 3.318%, and the 5-year note (5_YEAR) yield fell 3.5 basis points to 1.526%.

By Ben Eisen, MarketWatch