Jamie Redknapp echoed his sentiments, saying they are harbouring unrealistic expectations after a strong start.
The Hammers were soundly beaten on Sunday afternoon, as London rivals Tottenham thrashed them 4-1 at White Hart Lane.
It was a hugely disappointing display from the Hammers, who have been impressive on their travels this season with wins against Arsenal, Liverpool and Manchester City under their belts.
This display was nowhere near the fine performance that they showed in those big wins, with confidence sure to have taken a blow in the loss.
Parker though, says that it was just a blip in confidence and their reaction to the defeat will be key.
"West Ham are a mid-table team, they have some very good players and I see this as just a blip in confidence," he told Sky Sports.
"It depends how quickly you can bounce back from it. Bilic is right when he says 4-1 in a London derby hurts a little bit more and they need to try and re-group a bit.”
Jamie Redknapp echoed those sentiments, saying that their performances in the beginning of the campaign have created unrealistic expectations at the club.
After an impressive start to the campaign, with them currently sitting 6th in the table, there was talk that they could make the Champions League this season.
There is fierce competition for those places this year though, and the loss of Dimitri Payet is sure to be a big blow to their prospects over the next few months.
And Redknapp says that they are simply a mid-table team who have been punching above their weight so far, and must pick themselves back up after the loss to Spurs.
"I think they've been punching above their weight,” he added.
"Bilic has done a great job and they're playing good football but I think they're a mid-table team. I don't think we should get too excited thinking they can get into the top four.”