The choke price is reached when the price rises high enough that demand for that item (or commodity – the term is often used in commodities trading) reaches zero. The choke price is the exact point at which demand ceases. Buyers are also not interested in anything with a higher price, but the choke price is the lowest for which there is zero demand.
The choke price is used in demand and supply analysis.
choke price in the news
In December 2012 a writer for FT Alphaville noted the effect of quantitative easing on gold’s choke price. She pointed out that in 2011 that a flattening curve in spot gold suggested that a choke price was about to be reached and that until it was reached people would continue to want to buy and hoard gold. However, new expectations of higher interest rates in the US led to renewed buying interest in gold and shifted the choke price temporarily higher.