Davies told the Bolton News: "I think it's a good time to play Blackburn. It's a derby and we'll be going there with our tails up. Hopefully we'll keep performing.
"We have Liverpool at home after that and we feel we can turn them over as well."
Bolton now have a European clash against Sporting Lisbon to look forward to but Davies insists this will not affect their approach to league matches.
The 30-year-old, who joined Blackburn from Southampton in a £7.5million deal 10 years ago, added: "The lads are buzzing after knocking out Atletico.
"It's a very strong performance against a very good side. To make the last 16 is an unbelievable achievement.
"Everyone is very excited. Now we are looking forward to Sporting. We feel we have a decent chance of getting through to the last eight there.
"We want to enjoy the moment but we are also mindful that we have a very important game on Sunday.
"We've let points slip away which could have pulled us out of it. We have tough games coming up and this will give everyone a massive lift.
"We feel like this is a nice distraction for us.
"The league is still the priority and we've got some tough games coming up. But getting past Atletico gives us the confidence we need and we feel we can go to Blackburn and get three points."