Having arrived in December with the Black Cats in the midst of a relegation battle, the Northern Irishman has now set his sights set on a top-half finish and a place at Wembley
The 60-year-old has sparked a revival on Wearside since his appointment back in December, lifting the Mackems from the heart of a relegation battle into ninth place in the Premier League table.
The Black Cats also face an FA Cup replay at home to Everton which could see them seal a semi-final trip to Wembley against Liverpool.
Under his stewardship, Sunderland have in fact lost just four of 19 matches, and O'Neill believes that things could hardly have gone better.
Asked if he could have envisaged the current situation when taking the job, he told reporters: "No, I could not. I wouldn't have envisaged us being even in the semi-final draw, for what it's worth.
"We still obviously haven't passed the quarter-final stage, but to be actually in a semi-final draw and at least to know who you might play if there was a possibility of getting through.
"But more importantly than that, the number of points we have been able to accumulate, I wouldn't have envisaged that at all."
Sunderland are 22/1 with Bet365 to defeat struggling Blackburn 3-1 on Tuesday night.
O'Neill took over from Steve Bruce with the Black Cats having collected a mere 11 points from their first 14 league games.
They will take on Blackburn at Ewood Park on Tuesday evening having added a further 26 from their subsequent 14 fixtures.
As such, they are a single win away from the 40-point mark often quoted as a safety target and O'Neill believes that the milestone will be comfortably enough to see teams through this term.
"I think now that 40 points this season will definitely secure survival in the Premier League," the coach continued.
"With the sides now in the positions that they are in, I think it would take a lot now for those sides to achieve 40 points.
"The truth is this year, if you were to give any of the bottom five 40 points, obviously they would take that in a trice."