The Magpies finished fifth in the table last season but have struggled in 2012-13 and are currently fifth bottom, just two points above the relegation zone and five better than the 19th-placed Royals.
Pardew, a former manager of Reading, knows tomorrow's match at St James' Park will be a real barometer of the quality in his side, who have only won once in their last nine games in all competitions and currently have just 21 of his 40-point target.
"It's an important game for us and Reading," Pardew said.
"I still think you need that magic 40 points and that will be more than enough. We're capable of getting that.
"People talk about a six pointer and all that but this actually is between us two clubs and we can't hide from that.
"We need to get that distance between us and then strengthen and all of a sudden we will look a lot more rosy than we do sitting here today."