Dann was born on Merseyside and used to be a Kop season ticket holder along with his father. But he hopes Alex McLeish's side can take advantage of Liverpool's current plight which sees them missing injured skipper Steven Gerrard and having striker Fernando Torres only half fit.
Dann, signed from Coventry during the close season, said: "I think this is just a blip for Liverpool. I think they've won only one out of eight and they've got too many good players to be losing that many games."
He added: "They're missing the big players and, when you miss your better players, then you won't get as many results.
"In a way, it gives you a lift, knowing that they've got quite a few players out, and knowing that you've got more chance of getting a result.
"But the longer that their poor run goes on, then they'll be trying extra hard to turn it around. It can work both ways but we've just got to stick to our own game.
"I think they'll start picking up soon - but hopefully it's after our game with them."
Twenty-two-year-old Dann has only played at Anfield once before - in a schoolboy game - and is relishing playing there in front of a full house as Blues look to build on their impressive draw with Manchester City.
He said: "I'm enjoying every game but this one will obviously be special having grown up in Liverpool and supported Liverpool as a lad.
"My dad used to take me until I started playing football myself of a weekend. We used to sit on the Kop. It was always a good atmosphere and I always said that I wanted to play there."