Despite the promising outlook, Federer insisted he was taking it one match at a time.
On Saturday, Federer led 6-3, 2-2 when the match was delayed by a heavy drizzle 56 minutes after it began.
Djokovic's performance in the final set against the world's 109th-ranked player on center court raised some eyebrows, with four-times grand slam champion Jim Courier saying the Serb had "capitulated".
20-times Grand Slam victor Federer is chasing a sixth title at the event, and will take some stop judging by the manner in which he swatted aside his 26-year-old opponent in only 58 minutes.
Djokovic was makings his first appearance since being stunned by Hyeon Chung at the Australian Open.
The final shot of the match was an errant forehand that was also his 58th unforced error.
"I think it speaks to my strengths on court, which is just being clutch and playing my best tennis in the big moments", Fritz said, adding, ".it's probably the stat that I'm most proud about in my tennis career".
The 24-year-old, who's a massive fan of the Fed, took some time away from tennis to visit a zoo, after crashing out of contention at Indian Wells to Caroline Garcia.
In the next round he faces Jeremy Chardy, who beat fellow Frenchman Adrian Mannarino 7-5, 4-6, 6-1.
American Amanda Anisimova took down two-time Wimbledon champion Petra Kvitova 6-2, 6-4 in a match lasting just over an hour to become the first 16-year-old to move into the fourth round at Indian Wells since Viktoriya Kutuzova in 2005.
Daniel, speaking on the biggest win of his career, said, "It's kind of hard to describe.I can't believe I beat someone like that on the center court like this; it's insane". "I mean, I just completely lost rhythm, everything".
"I wasn't playing that good in my first [opening] round. It was a good day". Cuevas was leading 3-6, 6-4, 4-2 when Thiem packed it in.