The Hammers were smashed in the previous meeting between the two sides early in the season.
But Pellegrini understands what the opposition must do if they want to best the table topping Reds.
"Of course we can beat Liverpool because every team can win every match in the Premier League," he said in his press conference.
"We want to beat Liverpool. We cannot play on nerves because they have top players who can change the game at any time.
"We need to play at high pace like we did at home to Arsenal and Manchester United and other clubs."
