"I benefited hugely from the two days off and I'm sure the players did," added the former Bolton manager.
"I was really quite mentally fatigued [by the defeat] because it's never off your mind when something like that happens.
"We were very disappointed but we didn't want to make the players any more disappointed. I picked the strongest side I had available today and they've gone and done the job."
However, Allardyce admitted that last week's thrashing at Old Trafford was still raw in the players' minds and that caused some uncomfortable moments early on, with Wolves twice hitting the bar in the first five minutes and Paul Robinson saving well from Matt Jarvis.
Glum McCarthy predicts 'bad Christmas'
Allardyce said: "Dunn's goal settled us down because we weren't looking too clever up to that point. The goal settled us down a bit because of the nerves from last week.
"We were clinical and professional. We're climbing the heights now and I have to credit the players. They were determined to put last week's result behind them and they've done a magnificent job."
Meanwhile, his Wolves counterpart Mick McCarthy said poor defending had let his side down.
"We defended badly. Bearing in mind we haven't had a clean sheet for so long, maybe it's not a surprise," he added.
"We had a bit of bad luck at the start by not scoring but then let's have an ugly point at 0-0, not concede goals that we shouldn't concede.
"We started the game really well. We've just got to keep going and keep working at it."
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