Goals from Thierry Ambrose, Brahim Diaz and Jadon Sancho saw his side beat Everton and move within three points of them at the top of the Premier League 2 table.
Davies was delighted his side came through such a difficult encounter and believes it shows the positive attitude within the camp.
He said: “We battled really well against a team that’s well-structured and very physical. We showed a lot of character as a team and that is what saw us through. The lads followed the details they have been given to the letter.
“They will always look at the league table and they should do. It’s a balance between developing and winning matches but they are a step away from the first team so winning will soon be everything.
“We set up and try to win every game and it’s nice to have something to play for at the end of the season. Let’s see what the next four games bring.”
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Davies selected one of his strongest line-ups of the season so far, naming first teamers Angus Gunn and Tosin Adarabioyo alongside many of the usual suspects in the EDS set-up.
Explaining his selection, he said: “The manager [Pep Guardiola] has given his instructions and these lads needed some game time. They required a game and they were part of a very good team performance tonight.”
Having already made one return from injury this season, Ambrose’s neatly taken opening goal delighted Davies and his staff.
“I’m really pleased for Thierry to have come on and got his goal because he has had a frustrating time over the last few months.
“When he came on he gave us a little bit more up the pitch. They pressed really aggressively and bringing Thierry on made it a little to get out while still playing possession based football.”
City will travel to Arsenal’s Emirates Stadium on Monday 13 March in their next Premier League 2 encounter.