The 31-year-old key forward tore ankle ligaments in the round 16 match against Carlton and has been on a strict physiotherapy program ever since.
"It is coming along slowly and it is more frustrating than anything," O'Loughlin said.
"I started slowly running two weeks ago and I am hoping to step that up a level on Friday. I was initially on crutches for a couple of weeks and also wore a moon boot but now I am moving more freely.
"The aim was always to be fit for the last match of the home and away season."
O'Loughlin has been sorely missed in the past four weeks and the Sydney Swans will miss his presence this week as they try to reverse their losing run when they meet Collingwood.
"There are huge stakes to play for this week and I think we play our best when our backs are to the wall," O'Loughlin said.
"We have been down the past six to seven weeks and I think you will see us put it all in the tank this week."
The Swans could use the magic of O'Loughlin, who has kicked 36 goals from 16 matches this year, and overall is the team's second-highest goal kicker with 497 goals from 286 games.
O'Loughlin, like most players, doesn't enjoy watching from the sidelines.
"It is very frustrating not being able to get out and help the boys," he said.
"The guys don't want to go out like this and I have no doubt we will make the finals. I am confident you will see us rebound this week and have a win against Collingwood."
