Xabi Alonso is confident Liverpool can reach the UEFA Champions League final, but is wary of quarter-final opponents PSV Eindhoven.
The Reds are aiming to emulate their 2005 success in the competition and meet PSV in the last eight in early April.
Spanish midfielder Alonso is not keen to look too far ahead, but feels Liverpool have the potential to reach the final in Athens in May.
"In the Champions League we're in a good position and we are really confident," Alonso told Sky Sports News.
"We have a lot of respect for PSV, they are going to be a really tough opponent like they showed against Arsenal.
"Of course there is still a long way to go, but we are confident we can reach the final. We must go step by step now and think about the quarter-final against PSV.
"We have played the qualifying round against them. We played in Eindhoven and drew, and at Anfield we won.
"We know the quarter-finals are a completely different challenge to go through to the semi-finals.
"We have a lot of respect for PSV and we know them very well."
As for Liverpool's domestic form, Alonso remains rueful about a poor start away from home, which cost the club any chance of being involved in the Premiership title race.
He added: "We would like to be in a much better position in the Premiership.
"The start of the division was a little disappointing losing so many games away and because of that the gap has been so big."
X-men
GO REDS GO!!
Though we got positive results against PSV in the group stage... its the quaters now... things might be different.