Los Blancos find themselves three adrift of Primera Division leaders Atletico Madrid and two behind Barcelona after back-to-back defeats in the last week. The first of those losses came in the 'Clasico' against Barca at the Bernabeu last Sunday and it was compounded by another setback at Sevilla in midweek, where Real lost 2-1 after leading.
Such a week could have dented confidence at some clubs but former Malaga playmaker Isco insists that is not the case at Real.
"We are Real Madrid and are obliged to pick ourselves up," he told realmadrid.com.
"There are eight games left and we are confident in our ability to turn this situation around. We have already done that more than once. We came back from six points behind so why wouldn't we be able to do that now?
"The sooner the La Liga encounter against Rayo comes around the better, as it will allow us to get back to winning ways because now we are into the most intense and important part of the season."
Isco believes the Bernabeu crowd has a vital role to play and that it must not lose faith in the team.
"This (week) has been a big blow for the supporters and also for us," he said.
"But they should remain calm. We are still competing in all three competitions. We are going to give it our all and fight until the very end like we have been doing up until now. They should get behind the team because that is very important for us."
Real will have defender Sergio Ramos back in their ranks after he was suspended against Sevilla following his dismissal in the 'Clasico'.
Opponents Rayo are a team on the up, having won four and drawn one of their last five La Liga games.
Their coach Paco Jemez told his club's official website after Wednesday night's 1-0 win at home to Osasuna, which took them to 12th: "Of course we have a chance of winning (at the Bernabeu).
"I can't think of a better stage on which to compete, and if anyone thinks that we are going to relax is wrong.
"We will go there to play and if we concede seven it will be because they are better, but we will compete and enjoy the match.
"You want to keep winning streaks going - we have less chances to win in this match but we cling to them because we want to go on a run."