Liverpool have recovered strongly from their disappointing 3-0 defeat by Manchester City earlier this month, winning five successive matches across three competitions. Their latest success came against Chelsea on Wednesday, when they progressed to the League Cup quarter-finals after a penalty shootout.

However, fourth-placed Liverpool remain six points behind leaders Arsenal, who visit Anfield on Sunday.

Iraola believes his team must concentrate on improving rather than getting carried away by their recent results.

"It's still October, take one game at a time," he said.

"I always say the first reference is normally when we have played against each other once, halfway through the season, and then you can start looking at the standings.

"Now we are in a position where we need to improve and keep getting better. Can fans dream? It's good if they have expectations and think we can win. But if you ask me, it is still early."

Iraola has enjoyed considerable success against Arsenal, winning three of his last four meetings with the London club during his time as Bournemouth manager.

However, he insists those results will count for little when Liverpool face the reigning champions.

"It is true we had good results against them with Bournemouth, but it does not mean a lot as it is a totally different team, different group of players and different moments," he said.

The Spaniard knows Liverpool will need to be at their best against an Arsenal side who have lost just once in the league this season.

Arsenal are also looking to end a long wait for victory at Anfield, having not won a Premier League match at the stadium since 2012.

Iraola highlighted the importance of winning individual battles and dealing with Arsenal's physical strength and threat from set-pieces.

"At the end of the day it is about winning the duels, running more than them, winning the aerial duels, set plays, mini games, these things that you have to control against Arsenal," he said.

"They are the champions, they are top of the league right now and they have only lost one game this season."

Sunday's encounter will also bring Iraola face to face with his former teammate Mikel Arteta. The two Spaniards came through the youth ranks together in San Sebastian in the Basque Country.

Iraola has recently faced several familiar faces in the opposition dugout, including former friend Xabi Alonso, who is Chelsea's manager.

"Last week was Xabi, now Mikel, a lot of former friends on the opposition bench lately," he said.

"I think it is a good thing in terms of spending five or 10 minutes after the game normally with them."

Liverpool could also receive a boost with Dominik Szoboszlai and Victor Munoz in contention to return from hamstring and knee injuries respectively.

Ronaldo admits Portugal win over Ghana 'was a tough game'