Real Madrid are already not in good form then this match will be played at Anfield stadium so I don't see much hope for Real Madrid in this match. I had confidence in Real Madrid until the big defeat against AC Milan, but since AC Milan beat Real Madrid by a big margin, I don't think it will be too difficult for Liverpool. But Real Madrid have had plenty of time to compose themselves and work on their mistakes before taking on Liverpool after their big defeat against AC Miller. Real Madrid will also have a good chance against Liverpool if they can plan properly and mark Liverpool's weak points well. But Real Madrid knows that this match is very important for them and they have performed well in such important matches before so Madrid fans can expect a win.
Real Madrid have been underrated in the Champions League by many sports pundits because of they lost against AC Milan and LOSC. The massive defeat by Barcelona recently has also contributed to people rating them very low in the games against Liverpool.I don't also blame them because this was not the Real Madrid we saw last season.
Regarding the game with Liverpool in Anfield, it is unpredictable. Liverpool is in good form but we cannot doubt that the visitors still has a team that can come up with a surprise. Liverpool whitewashed Bayer Leverkusen in their last UCL game but they would not have a smooth ride over the defending Champions.