The 17-time Grand Slam winner will be starting afresh in the second round on the Monte Carlo Country Club clay after his early February knee operation.
After hitting for nearly a week at the seaside venue overlooking the Mediterranean, the Swiss said that next week will be key for deciding his further schedule ahead of the French Open - the second major of the season.
"I feel more rust than rest, but I am rested, mentally and physically," the 34-year-old said.
"I don't think about the Roland Garros title," the 2009 Paris champion added.
"I believe I can do it; every event at the Grand Slam gives me another opportunity to do that.
"I've been training super hard on clay, I'll be able to decide better about playing any of the Masters 1000 tournaments which come later (Madrid and Rome next month) - one, two or even none.
"Everything is flexible, you are automatically entered in Masters 1000 events, there is nothing I can do about that. Everyone thinks I've entered Madrid and Rome.
"It's bad spin when you pull out and people think you've let the tournament down. But I know I can always add a Madrid or a Rome to my calendar."
As he prepares for the second round against either Brazilian Thomaz Bellucci and Spaniard Guillermo Garcia-Lopez, Federer will be organizing his comeback strategy on the fly.
"If I win the tournament, that changes everything. If I lose 0-0 in the first match, that changes everything.
"I'll know more in two weeks and I can decide the week before Madrid if I will go there or not."
Federer is seeded third behind Andy Murray and world number one Novak Djokovic, whose confidence and spirits could not be any higher after winning his fourth title of the season a week ago in Miami.
"I've always wanted to be where I am at the moment," said the Monaco-based Serb.
"I'm doing something that is worth it. I've put myself in the position to fight for biggest trophies in sport.
"Thankfully I've not lost too many matches in the last couple of years, I'm playing the best tennis of my life. That comes after years of dedication, evolution and growth and understanding myself as a player.
In a first-round result, France's Jeremy Chardy advanced to the delight of the local crowd, beating Russia's Andrey Kuznetsov 7-6 (7/3), 7-5.