Wolves host the Reds on the back of a derby win against Aston Villa on Friday.
Liverpool also go into the clash having thumped West Ham 5-2 on Saturday, though Edwards says: “In the Premier League, anyone on their day can give anyone a run for their money and anyone a game.
"We are showing that at the moment, but this is a different game now. It’s a different game to when we played them last time, it's a different game to Friday night. To threaten these teams and to compete, we have to be at our best."
On the spirit around the club, Edwards says the change is palpable.
He continued: “We've not had that long here yet, three and a bit months, but we've not had loads to shout about. We've had some good performances and a few results this calendar year, but that was a big moment, I felt for the whole club, to be honest. It was a really nice moment to share with the supporters, in a game that really mattered to them.
“It's all right me banging on about the lads performing, competing and giving everything. But we're in a business where, really, people only look if you're getting the results. So, when you do get a performance like that and then a win against the team like that, it maybe amplifies a little bit of what I'm saying, and people perhaps will believe it a little bit more.
"It's great for the feel around the place, but the lads are just getting a bit more confirmation of their performance levels. How much harder they're working now from when we first came in is stark, and the facts are there, it’s really evident. We’ve still got a long way to go, but there has been a lot of improvement made, and that showed it.
“But then quite quickly, you're back on the wheel again, and then you're preparing for two massive games against another giant of a football club and loads of brilliant players again. So, we have to get ready for that.”