Do i need to worry about leveling the floor if there are dips no more then 1/8 "
Ideally, you don’t rely on the thinset mortar to “float” tiles into level. You want to lay thinset down with the correct size notched trowel, and press each tile down firmly until the mortar stops yielding. 

Whether or not the 1/8” dips matter depends largely on the size of each tile. If they are 1” x 1” tile, it won’t matter, the tile will easily handle the slight changes in the floor, but if they are 1’ x 1’ they might not.

You can correct the dips with thinset mortar and a good thin steel trowel, or self leveling cement.