Jurgen Klopp's side lifted the Carabao Cup and FA Cup last season and were just two games away from completing an unprecedented four-trophy haul before finishing second in the Premier League on the final day and losing the Champions League final to Real Madrid in Paris.
However, Liverpool have looked a different team this season and have fallen to ninth place in the Premier League -- 10 points behind fourth-place behind Manchester United -- after their goalless draw to Chelsea on Saturday.
Thiago said Liverpool have been impacted by the physical and mental toll of their marathon run last season that saw them play 63 games -- their highest possible in a single game.
"We are in a great position for Champions League and FA Cup," Thiago said. "We are not in the position we want in the Premier League, but we are there.
"We are now in our reality where we have to go game by game. Try to add those three points will help us to be as high as possible. Our aim is the next game. It's not about to be in the top four or to be in Europa League. We just think about next game.
"We have to be together as a team. It's not just in the bad moments. In the good moments as well.
"For sure [last season's finish affected us]. It's not just about physical stuff. It's also something psychological. We were so close to winning everything. We just touched it but it went away.
"Last season I had one of the greatest seasons I've had in my life. This season is not one of the best, but it doesn't matter. It's a season, it's a challenge. I think we have great quality and great guys to sort it out and we will do that."
Liverpool next face Brighton in the FA Cup fourth round on Sunday looking for retribution after losing 3-0 at the Amex Stadium on Jan 14.