Gatland admitted Wales will need to improve in certain areas to beat the Springboks next weekend but he saw enough against the Wallabies to suggest Wales can topple the reigning World Champions.
"There's mixed emotions," said Gatland, after Wales fell agonizingly short against the inform tourists.
"There were some really positive things that came out of the game. I thought we scrummaged really well, I thought the lineout was good, but a couple of costly turnovers made it tough for us.
"We did a pretty good job on nullifying David Pocock and we put them under a lot of pressure at scrum time. We talked about turning our scrum dominance into points but we didn't do that.
"We created a few chances and had a few shots at goal and we didn't take them.
"In a close game, if we had been a bit more accurate, taken our points and kicked our goals, it could have been a different story."
Wales faced a near full-strength Wallaby outfit without the likes of Test regulars Lee Byrne, Leigh Halfpenny, Jamie Roberts and Ryan Jones.
And while Gatland refused to use their absence as an excuse for the defeat, he was pleased to be able to announce that Byrne, and possibly Jones, will be back in contention for Saturday's clash with South Africa.
"We played one of the best teams in the world without a few key players," added Gatland.
"We will get a lot out of the game and look to improve for next week. We hope to have Lee Byrne available and will check on the fitness of Ryan Jones. Ryan's still recovering from injury and hasn't had a lot of rugby.
"We need to look at one or two players and the impact some of them made off the bench. I thought the bench were pretty good in how they gave us some impetus towards the end.
"We have to pick it up for South Africa. We have got to work hard and make sure that we don't make those errors again because South Africa are going to be tough and physical.
"We need to build on this match and continue to improve."