City go to Barcelona next month needing to overcome a 2-1 first-leg deficit.
Demichelis said: "Without a doubt we are confident we can turn this around.
"We will go to Barcelona to try to do our best and progress.
"We want to dominate in Europe and we will achieve that in the coming years.
"It would be important for us to progress to the next round. We need to take that step in the Champions League."