Sporting have lost their last four league games and are just one place off the foot of the table, and their morale is in sharp contrast to this weekend's visitors to El Molinon.
Malaga boss Manuel Pellegrini strengthened his squad in the summer with the likes of Ruud van Nistelrooy, Joaquin, Joris Mathijsen and Jeremy Toulalan, and they have gelled quickly to lie sixth in La Liga following their goalless draw against Atletico Madrid.
But Preciado says that the millions spent by Malaga do not mean his side cannot claim three crucial points.
He told a press conference: "Malaga have the third biggest budget in the league after Real Madrid and Barcelona, but a team can beat anyone, just as they can lose to anyone.
"We need not fear to Malaga, we are playing with the advantage of our home crowd behind us.
"We know it will be a good intense game and we will have to counter Malaga's quality with our effort."
And Preciado feels the key to pulling off an upset will be whether his side are able to limit the influence of Malaga midfielder Isco and winger Santi Cazorla.
He added: "We know it is their natural tendency to play the ball through midfield and sometimes use Cazorla through the centre, and we have to plug the flow of Pellegrini's midfield.
"Isco is also a talented player and a hard worker, he has been one of the surprise packages of the season and he has earned the position by merit."