Arsenal, who have 45 points from 25 matches and trail fourth-placed Southampton by a single point, travel to a rejuvenated Palace side who have won five of their last eight games since Alan Pardew took charge.
"It's always very intense and it is a very dynamic ground," Wenger told a news conference on Friday.
"Alan Pardew has done extremely well. They have found confidence again and they made positive results and that is what it is about when you are a manager."
Former Gunners striker Marouane Chamakh is expected to line up for Palace and after struggling during his time at Arsenal and Wenger is delighted to see the Moroccan performing well in south London.
"He (Chamakh) lost confidence and I'm happy that he went to Crystal Palace and has made a good career now," Wenger said.
"He's not the target man anymore, he's more a midfielder or second striker. Because he's a real team player, that position suits him very well."
Midfielder Santi Cazorla has been in sparkling form for Arsenal since being deployed in a more central role and Wenger has been impressed with the Spaniard.
"Until now he has been maybe the most consistent," he said. "Since he has moved centrally his influence on the team has been bigger as well."
Arsenal could be boosted by the return of Jack Wilshere who has recovered from an ankle injury but fellow midfielders Alex Oxlade-Chamberlain and Aaron Ramsey are still carrying knocks.
"He is a bit ahead of schedule because he has worked hard," Wenger said. "Chamberlain is back in full training but is a bit short to be considered. (Aaron) Ramsey I think is 10 days away."
Thierry Henry has been at the Gunners' training ground this week after starting work on his coaching badges and Wenger expects Arsenal's all-time record goalscorer to have a positive impact on the club's young players.
"Thierry is making his first steps as a coach. It's good for our youngsters to be coached by him," he said.
"He's been here once or twice. All our former players are welcome to come back here and get their coaching badges. We're happy to have him."
(Reporting by Michael Hann, editing by Ed Osmond)
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