Allardyce believes that a win against the Mancunians can help spur the Wanderers on in their pursuit of league and cup success but has warned his side that they could also go the other way and end up in mid-table if they lose their focus.
Arsenal visit the Reebok Stadium next weekend in the Quarter Finals of the FA Cup as Wanderers look to make the Semi Finals of this competition for the first time in five years.
"The City match is two-pronged for me. It has to be a positive result to help us in the FA Cup and maintain a high league position.
"If we get a 1-0 win at City I will be dancing all the way home. I won't even bother driving back in the car. I would be that made up. That would take us into the Arsenal game in the frame of mind that we could repeat what we did in January - and that is get a victory.
"There would be nothing worse for me now than to be finishing in mid-table and getting knocked out of the cup