with updatebase_cte (MachineID,RecordedDate,Pressure,ind) as (

select s.MachineID,s.RecordedDate,s.Pressure, 0 as ind

from yourtable s

where s.RecordedDate='2012-10-02'

union all

select s.MachineID,s.RecordedDate,

case when s.Pressure = 0 and sc.Pressure <> 0 then sc.Pressure else s.Pressure end as Pressure,

case when s.Pressure = 0 and sc.Pressure <> 0 then 1 else 0 end as ind

from yourtable s

inner join updatebase_cte sc

on (s.RecordedDate = dateadd(day,1,sc.RecordedDate) and s.MachineID=sc.MachineID)

)

-- this will return data need be updated part, you can use it to update by a join.

select * from updatebase_cte where ind=1

Just a quick coding, have not got time to test. Does this work?:-)