The McFly star predicted that the Olympian could be "incredible" if she works on losing her nerves.
"Victoria has a lot of potential and she hasn't nearly fulfilled that," Judd told The Sun.
"She did better this week but I could tell she was still nervous and she needs to conquer that. Nerves get you focused, so it's about not letting them get the better of you."
He added: "You'd have thought I'd be asking her because she has nerves of steel when she's performing as an athlete!"
Judd also revealed that he thinks Denise Van Outen and Kimberley Walsh have a good chance of winning Strictly Come Dancing this year as they are "both amazing".
Photo gallery - Strictly Come Dancing week two: