Los Blancos maintained their 100 per cent record with Saturday’s 2-1 home win over Real Betis.
Vinicius Junior opened the scoring for his third goal of the season, with Rodrygo hitting a 65th minute winner after Sergio Canales leveled in the first half.
The victory means Real have four wins from four games, having scored 11 goals and conceded only four, ahead of their UEFA Champions League opener in midweek against Celtic.
“Our objective is to play good football and to pick up the points and the wins,” Ancelotti said.
“We’re capable of playing well, with the quality we have, combining well and good in transitions.
“The squad dynamic is good and we’re full of confidence in our abilities.
“On Tuesday we’ve got the most difficult game of this first half of the season.
“We’re going to be up against a team playing great football and we have to be ready.”
The Italian also revealed that he may rotate Karim Benzema out of the side, having started all four games this term.
“Its not true that Benzema doesn’t have replacements because he does, Mariano, Hazard, Rodrygo, and sometimes Asensio or Modric,” he said.
“He has a substitute, so were not going to destroy him. We play every three games after this one. I might need to rest him for one of the games.
“He’s been playing every week. He wasn’t at his sharpest in terms of his finishing today, but it wasn’t because of a lack of fitness.”
Elsewhere, Barcelona won 3-0 at Sevilla to continue their strong start to the campaign, while Los Nervionenses remain winless.