Forest are currently ninth in the league table with 50 points from 35 matches, as many as 11 points behind sixth-placed Brentford.
The Reds have enjoyed an upturn in fortunes since the appointment of Dougie Freedman as manager at the start of last month, following the departure of Stuart Pearce.
The Nottingham-based outfit have won five of the seven matches under the Scot, with the players stepping up and raising their standards over the past month or so.
Former Forest striker Birtles has now said that Freedman and his players should still aim for the playoffs despite the defeat to Charlton Athletic at The Valley on Tuesday.
“I would never rule it out because it is possible,” the 58-year-old told Sky Sports’ FL 72: Review show this week.
“We have talked about nerves when you get to the heavy highs, if you can handle those nerves and that pressure.
“So all he (Freedman) has got to say (to his players) is: do what you have been doing and we could still...if we can put three or four wins together and put a little bit of pressure on.”
Forest were an outside bet for the Championship playoffs until their defeat to Charlton, but the 11-point gap is perhaps too big to bridge.
Freedman has played down expectations of a late push for a top-six finish (click here to read more), but if the Reds can go on yet another winning run, then they could well be back in the race.
It will not be easy for Forest, though. Today the Nottingham-based club take on automatic promotion-hopefuls Middlesbrough, next weekend they face Leeds United at Elland Road, and at the end of the month they confront Norwich City away from home.
Forest will face Wolverhampton Wanderers, Brentford, Watford and Ipswich Town, among other clubs, in April.