The 19-year-old Spaniard has attracted interest from clubs such as Atletico Madrid and is a free agent at the end of the season, with his situation becoming a hot topic after his spectacular opener in the Carling Cup win over Liverpool last night.

Merida said: "At the moment I am talking to the club so I don't know what is going to happen. Hopefully everything is going to be all right but we are going to sit down and talk about it.

"I am really happy here and things are going okay. I am really happy in London too so we will see what happens."

Wenger is confident of securing the future of Merida, who has been billed as the new Cesc Fabregas.

Wenger said: "We are close to signing a new contract."

Wenger will restore his senior players for the Barclays Premier League clash against rivals Tottenham at the weekend, meaning the likes of Merida will have to wait for the Carling Cup quarter-finals for another chance to impress.

Merida feels Wenger's youngsters are good enough to win the trophy.

"There is no-one to fear because we can beat anyone but it is going to be really tough so we will see who we get next," he said.

"The Carling Cup is a cup where the young players get a chance to play and we have to prove as individuals and a team that we can play and against Liverpool we did.

"I gave 100% in every area and this cup is very important for us. We have to show what we can do and also enjoy it because we don't get many games."

Samir Nasri made his return from a fractured leg in the win over Liverpool, although he is cautious about declaring himself fully fit.

"The most important thing is not to suffer a relapse," said the France midfielder.

"The boss asked me two or three times during the game how I felt and I had to make a sign if I felt the slightest touch. But everything was all right.

"I was very satisfied with my comeback. After five months without playing, I had appetite, I wanted to get around the pitch and touch the ball.

"I thought that it would have been a little bit more difficult. We worked well with the physical assistant. Now, I need to play and play again."

Nasri is hoping his side can display the form they had before recent draws against AZ Alkmaar and West Ham.

"It was a small disappointment to drop two points while we led 2-0 at West Ham, he said. "We had the same against Alkmaar and we need to correct that but we were almost invincible for 10 games before that.

"Now it is necessary to win again in the Premier League. And there is nothing better than a derby against Tottenham. It's been a while since both teams met each other while so high in the table."