LONDON—Can the art market sustain its blistering growth? That was the question surrounding last week’s mid-season Contemporary art sales in London, held to coincide with the popular Frieze Art Fair. The London sales are seen as an important test of the market because they come less than a month before New York’s marquee auctions in November. The major auction houses were primed with big works, including five by Jean-Michel Basquiat.

The Friday-, Saturday-, and Sunday-night sales were full to bursting with art and buyers. At many lots there were more than a dozen bidders on phone lines—leaving the well-dressed auctioneers looking more like traffic cops. But by the end of the spree, three Basquiats had failed to find buyers—and the remaining two sold for low prices; several Damien Hirsts didn’t make their low estimates; and a bunch of other recently hot artists, like John Currin and Martin Kippenberger, struggled to attract buyers.

Works failing at auction isn’t necessarily the symptom of a sick market, however—in fact, it can be a sign of a healthy one. To the extent that the art market behaves like the financial markets, it is both highly efficient and adaptable—money flows to art that is in demand and away from works whose sellers are seeking to merely cash in on previous sales. But works of art are far from commodities. “The idea of calling something ‘the art market’ is misleading,” says Thea Westreich, a prominent New York art adviser. “It’s too diverse. Categories are rapidly folding in, expanding, and diluting at the same time.”

Chinese contemporary art, for example, which benefits from a relative lack of supply and rapidly increasing demand from newly wealthy Chinese collectors, grabbed big numbers in London. Bidders at Sotheby’s drove Yue Minjun’s Execution, a self-portrait that depicts the artist as both the firing squad and a line of victims, to $5.2 million, more than Yue’s major works have sold for recently.

But the best of Yue’s work has been consistently selling in the $4 million range all year. The shock was that other, lesser-known painters joined him in that league. Zeng Fanzhi’s Xiehe Hospital Series, Triptych went for $5.5 million at Phillips de Pury, blasting past the estimate of $1 million to $1.4 million, and Indian painter Raqib Shaw’s Garden of Earthly Delights III, estimated at $1.2 million by Sotheby’s, went for $5 million.

Dealers disagree about the meaning of such blowouts. For some, big price jumps represent nothing more than two bidders unable to keep their egos in check. Others see a harbinger of new value, especially if a work is unique and powerful. Yet everyone agrees that the result will be to draw more work by the artist onto the market—with higher estimates to test new price levels. If that work is not A-plus material, it will have trouble selling within the aggressive new range, let alone hitting an even higher price level. That accounts for many of the no-sells that have been on the market.

“That’s the way that these cycles work,” says Sotheby’s Contemporary expert Francis Outred. “A great work comes to market and makes a great price. Temptation is given into and then you get high estimates.”

Since the auction houses set estimates to attract sellers, a work that fails to sell, or sells at the low end of the estimate, may simply reflect the outsized ambitions of the current owner. In the past several years, because works of art have broken price record after price record, results that fall within those estimates are interpreted as weakness in the market.

That’s what happened with the five Basquiats in London. The artist, who died in 1988, set records in the $5 million range throughout the art boom, from 1998 to today, and many experts felt his best work—primitively scrawled and monumental in size—was due for a price jump. It came this spring with works selling for $10 million and $14.6 million, and collectors are thinking their Basquiats must be worth $10 million now too.

“I’m not surprised that the Basquiats performed as they did,” says Westreich. The three Basquiats that didn’t sell, and the two that sold— for $1.9 million and $5.7 million—lacked signature elements that would have made the paintings world-class. “I think it’s a question of quality.”

Last week three of Damien Hirst’s very popular spot paintings—grids of colored dots with chemical titles—were on the block. Two sold within their estimates, at $1.2 million and $1.3 million, respectively. The third canvas, with a $3.6 million low estimate, failed to find a buyer. But these seemingly weak sales of Basquiats and Hirsts don’t necessarily indicate the market is doomed—rather, they signal that collectors have found their comfort level for these particular paintings, and it may be a while before prices move again.

“There’s lots of little micromarkets going on,” says Sotheby’s Outred. So while collectors may have lost their passion for Hirst’s spot paintings, his Eternity, a kaleidoscope pattern of painted butterflies, which Phillips de Pury estimated at $5 million to $7 million, went for nearly $9.5 million.

Indeed, today’s micromarket may be tomorrow’s market mover. Four years ago, Contemporary Chinese painting didn’t exist as a sales category. Two years ago, Sotheby’s sold $14 million worth of Contemporary Chinese art around the world; so far this year, they’ve hauled in $133 million.

So what do the London sales really tell us? They’re not as much like financial markets as some would like to think. Financial markets ultimately reflect the health of the underlying economy, but the art market only measures the willingness of the wealthy to spend their disposable cash on art (a commodity with no intrinsic economic value). With $353 million worth of art changing hands in London among the three auction houses—a huge number for an off-season sale—we know that the art market is still very healthy. But we also know that it is fickle.

Consider the art market more as a voting machine, and right now collectors are casting ballots for Contemporary Chinese art. But that shouldn’t overshadow significant sales in London, at multiples of their high estimates, for Europeans like Anish Kapoor, Anselm Reyle, and Beatriz Milhazes; or the solid sales for established Americans like Cecily Brown, Richard Prince, and Ed Ruscha, who saw their work bid above aggressive estimates too. These micromarkets are just as robust as that for Chinese art. That is, until the next round of sales in New York or back in London in December—when what attracts collectors’ dollars will be anyone’s guess.