They have momentum, after following a 31-19 victory over the Ospreys with Saturday's thrilling 35-30 win against Cardiff Blues - featuring tries from Ryan Grant, Leone Nakarawa, Taqele Naiyaravoro and new club captain Jonny Gray.
However, Townsend believes there is plenty for his side to work on this week.
"The scoreline goes down as a bonus-point win and ahead of the game we would certainly have taken that, but looking at the game we didn't play as well as we can," he said.
"There are a number of aspects we need to improve and there will be a lot of coaching points that we can take out of that game and things we need to focus on during the week.
"We've shown glimpses of what we're capable of (this season) and what pleases me most is the effort which has gone in.
"We've been very close in every match and we've managed to win our last two with bonus points, but the three we lost we were in positions to win.
"When you look at the players on the pitch and those who weren't available you can see we have real competition for places within the squad.
"The competition is healthy and the players have really stepped up and now as coaches we need to select the team we believe is the right one to put Racing 92 under pressure and start Europe with a very good performance next weekend."
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