Alan Kennedy says Liverpool's Champions League exit will only spur them on in their pursuit of the Premier League title.
The former Reds defender believes Tuesday's epic 4-4 draw at Chelsea proved Liverpool have the firepower to challenge Manchester United at the top of the league.
After losing the quarter-final 7-5 on aggregate, Rafael Benitez's side has six league fixtures to overtake United and claim their first top-flight crown since 1990.
"They can concentrate on the run-in but I'm sure Liverpool would still love to be in the Champions League; a mouth-watering tie against Barcelona was on the cards but it's not to be," Kennedy told Sky Sports News.
"Liverpool are scoring goals; when Fernando Torres went off we scored two extra goals so we can play without him if needed although he is going to be an integral part of the club's future.
"Liverpool have got some tough games to come including Arsenal next week but they have also got some good home games against teams that are mid-table.
"I just fancy Liverpool at the moment because they are playing some terrific football no matter what team goes out there; Rafa seems to be getting the best out of them.
"I know they are conceding goals but they are enjoying themselves out there and Manchester United have some important games to come and anything can happen."
Liverpool, without injured skipper Steven Gerrard, trailed 3-1 from the first leg at Anfield but made it 3-3 on aggregate thanks to a Fabio Aurelio free-kick and Xabi Alonso's penalty.
At that point it looked as though the visitors could pull off a sensational victory on the eve of the 20th anniversary of the Hillsborough disaster, but despite further strikes from Lucas and Dirk Kuyt Chelsea managed to hold on.
"On the back of what's been going on and what's happening today (in relation to Hillsborough) it was a terrific performance.
"I actually thought Liverpool could go on and win the game - I honestly believed it was there for the taking, but Frank Lampard came up with a tremendous strike that gave the goalkeeper no chance.
"It was a see-saw sort of a game, it really was, and credit to both teams. Liverpool have this knack of producing some great football when it is needed. That was one heck of a game."
Kennedy felt Liverpool missed the input of talismanic skipper Gerrard, but was keen his absence did not overshadow the quality of the contest.
"First of all, I'd like to give players who actually performed," he said.
"I know Chelsea had conceded three late goals against Bolton but to go there and take the game to them was credit to them.
"We knew Chelsea would come back at Liverpool; Guus Hiddink had words, and I think very strong words, with his players and it seemed to galvanise them as they came back strongly.
"The game itself probably needed Gerrard to be in it but unfortunately his injury didn't permit him to do so; it's disappointing from that point of view but I think every player on the pitch stood up to be counted and can say they've played in one of the best games in the Champions League."