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Carlin, 25, has secured her place in Team GB's squad and claimed a silver medal in the 800m freestyle at the European Championships on Thursday.
Commonwealth champion Carlin missed the 2012 Olympics because of illness.
"Europeans, Commonwealths, Worlds - she's done all of them absolutely right," Davies told BBC Radio Wales.
"She's an incredibly hard worker. She worries a little bit too much and needs to have more confidence in herself."
Davies believes Rebecca Adlington, who won two gold medals at the 2008 Beijing Olympics, can serve as both a motivation and a warning for Carlin.
"The amount of work Jazz puts in is absolutely second to none," said Davies. "She's not very far from Rebecca's British record, which I think is very firmly in her sights.
"I watched Rebecca melt down at the Olympics through nervous energy and there was so much expectation on her shoulders in London after the success she had in Beijing so that's what Jazz has got to be most careful of."
Davies, who won silver at the 1980 Olympic Games in Moscow, was also pleased to see Chloe Tutton break through, after the 19-year-old Welsh swimmer qualified for Rio.
Tutton claimed bronze in the 100m breaststroke at the European Championships on Wednesday, having won 200m breaststroke gold at the British Championships.
"British men's breaststroke is amazing but women's breaststroke has not been," Davies said.
"We've got some youngsters in the squad who are going to use these Games as experience.
"I don't think we're expecting Chloe to go there to win medals, but she could make a final which would probably be her target and we'd love to see her again in four years' time."

He died on Monday, aged 89, in a nursing home in Newmarket-on-Fergus in County Clare, following an illness.
Bishop Casey resigned as Bishop of Galway following the revelation he had been making payments to a woman in the United States for a long period.
He had a relationship with an American divorcee and was the father of her son.
Peter Murphy was born in 1974 and was the result of Bishop Casey's affair with Annie Murphy.
Speaking on BBC's Evening Extra programme, Michael Kelly of The Irish Catholic newspaper described the event as "the beginning of the end of the extreme dominance of the Catholic Church in Irish public life".
When the relationship became public in 1992, Bishop Casey resigned his post and went to America.
He later moved to Mexico to learn Spanish, worked as a missionary priest in Ecuador and then worked in a parish in England before retiring to Galway 14 years later.
In 2006 he came home to live in Shanaglish, near Gort, County Galway, and then Carrigoran Nursing Home in County Clare in 2011.
Born in County Kerry on 24 April 1927, Bishop Casey was educated in Limerick and in Saint Patrick's College, Maynooth, from where he was ordained to the priesthood in 1951.
For the next nine years he worked as a curate in two Limerick city parishes before being appointed to the Irish Emigrant Chaplaincy Service in England.
He became well-known while working in London for sourcing adequate housing for thousands of Irish emigrants.
On Monday, the Catholic Church said "his passionate advocacy for social justice and for those marginalised by inequality gave him a significant public profile and his work in this area continued throughout his life".
He was appointed Bishop of Kerry in 1969 before taking on the larger and more high-profile diocese of Galway and Kilmacduagh in 1976.
"Perhaps the highlight of his time in Galway was his organising and hosting the visit of Pope John Paul II to the city in 1979 to meet and pray with 300,000 young people from all over Ireland," the Catholic Church said.
Bishop Casey was present at the funeral of his murdered friend Archbishop Oscar Romero of El Salvador when the liturgy was interrupted by bombs and intense gunfire which left almost 50 mourners dead.
He also voiced strong objections to the visit of US President Ronald Regan to Galway in 1984 because of "American foreign policy".
Archbishop Eamon Martin said:  "It is with great sadness that I learned today of the death of Bishop Eamonn Casey.
"I wish to sincerely acknowledge the contribution of Bishop Casey to the work of the Irish Catholic Bishops' Conference over twenty-three years during his time as Bishop of Kerry and as Bishop of Galway".
Wales' Jazz Carlin needs to believe in herself if she is to succeed in Rio this summer, says former Olympic silver medallist Sharron Davies.
[NEXT_CONCEPT]
Former Bishop of Galway, Eamon Casey, who was at the centre of a scandal that rocked the Catholic Church in the early 1990s, has died.