LONDON (REUTERS).- At the top end of the art market, the financial crisis seems a distant memory -- surging prices saw Christie's and Sotheby's post impressive 2010 results that were back to, or above pre-crisis levels.

Yet while the market leaders are confident the recovery from 2009's deep slump can be sustained, the prospect of speculative money pouring into art, driven partly by rich Chinese investors, increases the risk of boom and bust, some analysts believe.

"This bull market trend could go on for some time, supported by China's rising class of super-wealthy, but eventually the bubble will burst, as it did in Japan in the early 90s and the global art market crash in 2008," ArtTactic said in its latest analysis of the contemporary art market.

"Too much speculative money will push art prices beyond their long-term, intrinsic art historic value, and it will become a game of who's the Greatest Fool."

The research company said it believed more "hot" money, lured by recent spectacular gains, would enter not only emerging markets but also established Western markets too, with Andy Warhol paintings a prime candidate for further speculation.

"We will experience mini-booms and busts more frequently than in the past as speculators move in and out of different markets trying to cash in on the latest trend," ArtTactic said.

"We see 2011 being the start of this new era, where art is increasingly moving from a collectable asset toward a financial asset."

PICASSO AND GAUGUIN LEAD
Over the next two weeks in London, the two big auctioneers are offering works worth around $650 million at impressionist and modern, surreal, and post-war and contemporary art sales.

While New York is still the art market hub, London is not far behind and an increasingly international client base, plus the rise of internet bidding, means the February sales should give a fair picture of the state of the global art market.

Jussi Pylkkanen, president of Christie's Europe, said he was confident going into 2011 that the strength of the market was sustainable and that there was room for further growth.

The number of new clients who registered for a sale at the world's largest auction house last year rose 23 percent on 2009, and the number of people who bought an item was up 13 percent.

"It's that rise of new registrants which really for me signals both sustainability and actually further potential growth," he told Reuters in a recent interview.

"This new influx of buyers ... continues to grow, and that really is the vital piece for me," he added. "I am very comfortable that it is sustainable."

As long as prices remain high, experts argue, top quality works will continue to come on to the market, creating a cycle that is vital to the market's future expansion. A knock in confidence hits supply just as much as demand, they add.

Christie's posted record annual sales of 3.3 billion pounds ($5 billion) in 2010, up 53 percent on 2009. Sotheby's boasted an auction total, not including private sales, of $4.3 billion in 2010 versus $2.3 billion in 2009.

The next test for the market comes on February 8 at Sotheby's, with impressionist and modern works worth 56-79 million pounds going under the hammer. Among its star lots is Pablo Picasso's "La Lecture" of 1932 valued at 12-18 million pounds.

The following evening, Christie's opens its account at an auction valued at 55-81 million pounds (excluding surreal works) that includes a still life by Paul Gauguin in tribute to Vincent Van Gogh estimated to fetch 7-10 million pounds.

It was at the equivalent sales in 2010 that Sotheby's broke the auction record when a Giacometti statue raised $104.3 million. Months later, Christie's sold Picasso's "Nude, Green Leaves, and Bust" for $106.5 million in New York.

(Reporting by Mike Collett-White)