Liverpool have made one signing so far this summer, bringing in 17-year-old Sepp van den Berg.
The Reds came agonisingly close to winning the Premier League last season but finished off the campaign with their sixth European Cup triumph, beating Tottenham in the Champions League final.
Nicol admits there is not much improvement needed in the Liverpool squad as they look to go one better in the Premier League.
However, he would like to see a new centre-back and creative midfielder brought to the club.
And he named Ajax captain Matthijs de Ligt and Leicester star James Maddison as his dream duo.
“Liverpool right now, as far as the starting XI is concerned, don’t have a huge need,” Nicol told ESPN FC.
“They’ve just won the Champions League, they’ve just almost pipped Manchester City for the Premier League title. So they’re not far away.
“Yes they could do with signing some players.
“Are we looking for a wish list?
“If you have a wish list, then my wish list would be another centre-back.
“Somebody like De Ligt I think would be incredible.
“To have him and Van Dijk as your centre-back partnership would be a dream.
“I also would like somebody in the middle of the park who can do a little bit more than getting the ball back.
“Let’s be honest, Liverpool’s midfield right now is about retaining the ball or getting it back and giving it to the front three.
“I would like to see a little tweak in there, somebody like a James Maddison who will do the work getting the ball back but who, when going forward, has the ability to pick a pass and to score a goal.
“I think that would be my wish for there.”