MONTE CARLO (AFP) - Roger Federer believes his game has recovered sufficiently after a year of struggle for him to derail Rafael Nadal's hopes of creating Monte Carlo Masters history here on Sunday.

Federer and triple champion Nadal will meet for the third successive year in the final with the world number one looking to beat the Spaniard for only the second time in eight claycourt meetings.

His only win on the game's slowest surface over the world number two came in Hamburg in 2007 when Federer brought to an end Nadal's record 81-match winning run on clay.

"In Hamburg I played in a good way. I'm aware that he came to that final probably a little tired but he was on that 81-match streak so it was still a good victory," said Federer who moved into the final when third-seeded Novak Djokovic retired due to illness as the Swiss led their semi-final 6-3, 3-2.

"Nadal's been impressive, excellent, and there's only a handful of players who can beat him on clay.

"There's something about the way he moves around the court that is great to see. But you always get a chance against him and I want to be able to push him and see what he can come up with.

"But I need to have a better game plan than last year in the final when I played quite poorly."

Twelve months ago, Federer was swept aside 6-4, 6-4 as Nadal won his third Monte Carlo Masters title in a row equalling Ilie Nastase's Open era record set from 1971-1973.

Victory on Sunday will mean the French Open champion will become the first man since New Zealand's Anthony Wilding in 1914 to win four Monte Carlo titles in a row.

"I served better today and well when I had to," said Federer who was just two points away from an ignominious exit at the hands of Spain's world number 137 Ruben Ramirez Hidalgo in his first match here.

He also dropped the first set against Argentina's David Nalbandian in his quarter-final.

"I'm also more consistent with my backhand and today was my best match in terms of movement. I'm happy with the way I'm playing."

Second seed Nadal comfortably reached the final when he swept aside Russia's Nikolay Davydenko 6-3, 6-2, his 21st consecutive victory at the tournament.

Nadal, who has cruised through the competition without dropping a set, also registered his 97th win in his last 98 claycourt outings.

Australian Open champion Djokovic apologised to the crowd for his decision to quit. He had also retired from a crucial Davis Cup clash with Russia in February because of dizziness and nausea.

"I haven't been feeling well for three days and I've been waking up with a sore throat," said Australian Open champion Djokovic.

"I thought it was nothing serious but against the best player in the world you have to be able to run down a lot more balls and need more energy which I didn't have. I was feeling dizzy and I didn't want to risk anything."

Federer, who had been struck down with glandular fever in January and was swept out of the Australian Open by Djokovic, said he hadn't noticed that his Serbian opponent was sick.

"I didn't see anything until he called the doctor at the end of the first set. I didn't think it was that extreme but you just have to block it out and keep playing."

Fourth seed Davydenko had defeated Nadal to win the Miami Masters this year, but he cut a weary figure on Saturday having taken almost three hours to win his quarter-final against compatriot Igor Andreev the previous day.

"I have to be satisfied with winning 6-3, 6-2 against the fourth best player in the world," said Nadal who will take a 8-6 career lead over Federer into Sunday's final.

"I think he was more tired than me and that probably helped. But I played well today. My forehand worked well. I feel like I am becoming more adapted to the clay every day."