The holders were stunned when the Serbian champions claimed a shock lead on the stroke of half-time through Osman Bukari in Tuesday’s Group G clash at the Etihad Stadium.
City manager Guardiola said: “At the end, going in at half-time 1-0, after what we’ve done that’s nice – after winning the treble we need to be the type of champions who prove to ourselves that we are able to make a comeback.
“In this situation it’s nice to prove it. In both games we played incredible and immediately at the start of the second half.
“We have things to improve in general but that’s really, really good.”
Guardiola was particularly impressed with the performance of his goalscorers.
Alvarez has benefited from a run in the side this season while Rodri, match-winner in last season’s final, continues to excel.
Guardiola said of Alvarez: “His movement was so quick and he’s so young. What a signing the club have done.
“He has everything – fighting, goals, assists. Incredible. And he’s a lovely guy. Playing behind Erling (Haaland) he is an incredible threat.”
Rodri has developed into one of the best midfielders in the game during his time at City and Guardiola is in no doubt he is now at the top.
He said: “Yes, he’s the best – but hopefully he can be better. He has a good mentality and good things to improve.
“But we were lucky again that the club has signed these type of players.”
The downside for City was the loss of Bernardo Silva shortly before half-time with an unspecified injury.
Guardiola said: “I didn’t speak with the doctors but apparently for the next games he will not be able to play.”
The Portuguese joins an injury list that includes Kevin De Bruyne, Jack Grealish, John Stones and Mateo Kovacic.
Guardiola said: “When we have five important players – really, really important players – injured, to sustain that for a long time will be difficult. But it is what it is.
“We cannot have the salaries and budgets for transfers to have 55 players. It would be chaos for the clubs and they would be bankrupt. Sometimes it happens.”
Red Star coach Barak Bachar admitted City were the better side.
He said: “We tried, we fought, but we conceded an early goal in the second half. They should have scored more.
“They are a great team, they have exceptional players. After we conceded it was difficult to maintain the pace, because we never play at this pace in our league. We learned a lot from this match.”