MANCHESTER -- Manuel Pellegrini admitted Manchester City have to be worried about their form ahead of Sunday's derby and accepted they are playing poorly after they suffered a second successive defeat.
The City manager believes a lack of confidence is at the heart of his side's failings after they crashed out of the Capital One Cup as a weakened Newcastle team won 2-0.
City have conceded two goals in each of their past three games and Pellegrini admitted that they have problems in both penalty boxes.
He said in a news conference: "My feeling is that we are not playing well. We are in a difficult moment with a lack of trust. We are conceding too easy goals and we are not scoring the chances we have to score.
"It's a lack of confidence that we must address as soon as possible because we need to continue to be involved in the other competitions."
City host Manchester United at the Etihad Stadium and Pellegrini added: "Of course we must be worried. We didn't win the three games we played this week. We must be worried about that but we must find a solution and we must address it.
"I don't know if it is the worst performance of our team [in my reign] but we've had three games in a week and they have been very similar: we conceded two goals in each too easily and had a lot of chances in the three games to score and didn't so it's a difficult moment. There's a lack of trust but we are going to recover.
"We are conceding too easy goals with individual mistakes but I think we are not playing the way we normally play, we're not moving the ball as fast as we normally do.
"We're not playing easy as a team, we're playing too much as individual players and in attack we are missing too many chances. Maybe it's all linked with the lack of trust."