The former Republic of Ireland international watched Celtic beat Barcelona and Spartak Moscow at Parkhead to upset the odds and make the knockout stages. Only Barcelona have beaten Celtic in Glasgow in the Champions League proper with the Hoops racking up 15 wins in 22 matches over the years.
Coyle, who turned down the chance to be Celtic boss in 2009, said: "I've been to the last four games and I'm as excited as anybody else because I think it's brilliant for Celtic to be in the last 16 and it gives the whole of Scottish football a boost."
The ex-Bolton boss continued: "Regardless of who their opponents are, then there is no doubt they will be uneasy about facing Glasgow Celtic. The home record that Celtic have got in the Champions League is second to none. You look through Europe and it's an unbelievable record.
"The first game that Celtic have will be the home game. Regardless of who they play, I think they are going to be in very good shape going into the second leg of that last 16, and who's to say what they can achieve?"
Celtic manager Neil Lennon has pinpointed Borussia Dortmund and Manchester United as opponents to avoid.
"Neil will know best who he will want to play," Coyle said. "Regardless of who it is, you don't get to the last 16 without being of outstanding quality, so it's going to be a top team. But equally they will know as well that Celtic will be a real test for whoever it is they undertake."
Meanwhile, Coyle remains open to an approach from the Scottish Football Association as he waits for the right opportunity to return to management. The former Bolton, Burnley and St Johnstone manager has been without a job since being sacked by Wanderers in October.
Coyle has been linked with the vacant Scotland manager's post since Craig Levein was removed from the post last month but the SFA have so far taken their time to assess possible candidates.
Coyle said: "When the right opportunity comes about, then I'll know what it is. Equally people that think you're worthy of that consideration will know as well because they will know the ambition I have and how I like to go about it. And when you get that it will be a good match. That's exactly where we are."