Pep Guardiola dismissed the "genius" tag given to him by Carlo Ancelotti and warned that the Italian's Everton side would test Manchester City.

After the new Toffees boss described Guardiola in glowing terms in his own news conference, the City coach reciprocated the praise for one of European football's most decorated coaches.

City bounced back from defeat at Wolves by beating Sheffield United 2-0 at home on Sunday and will hope to end Ancelotti's 100 per cent record in the 60-year-old's third game in charge of Everton at the Etihad Stadium on New Year's Day.

"Everton is Everton, one of the biggest, most traditional, historical teams in England with incredible quality in its players," Guardiola told reporters.

Read: Ancelotti confident Everton can compete with Guardiola's City

"They struggle a bit this season for points but the quality is there, with a new manager with incredible experience.

"A manager like Carlo with his incredible capacity, he is one of the smartest guys and always he is able - it doesn't matter which team he takes, he makes them work.

"I know him quite well. We played a few times against [each other], not much. His teams always beat our teams. He is an incredible gentleman. He conducted some of the greatest and more experienced teams in Europe, the list is huge. When that happens it's because you're an incredible manager.

"It's incredible news for English football that he's back. He can do an incredible job at Everton."

Guardiola confirmed that defender John Stones and midfield playmaker David Silva were both fit to face Everton after recovering from injuries, but he said his side's packed fixture list is putting players at risk.

City takes on Everton, Port Vale and Manchester United in the first seven days of January and Guardiola said short breaks in between games were making recovery difficult.

"We have five games in 12 days," said Guardiola. "It's quite similar for the other teams but in this period one or two more days to recover is a lot.

"We take the risk, it was the same in the last game: 80 minutes with 10 against 11 in a difficult test against Wolves, then we train for two days and come back and play. It's a risk but you have to take it."