The former Kop hero was delighted by the Uruguay striker’s return to action in the midweek Capital One Cup defeat at Manchester United.
Writing in the Daily Mirror, Dalglish said: "It has been suggested that this must be the last chance for Luis at Liverpool and that if he steps out of line again, the club has to get rid of him.
"I don’t know if it’s his last chance. I don’t know if there is any more trouble coming down the line.
"But let’s be honest about this – the better the player, the more forgiveness is extended to him.
"That’s just the reality. The greater the need to have a player in your squad, the more the goalposts move in terms of what you forgive him for."
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