Ronaldo scored a hat-trick in the space of eight first-half minutes before adding two more after the break on Sunday, with Gareth Bale and Karim Benzema also on target, the latter twice.
Diego Mainz's own-goal capped an impressive victory, with Ancelotti suggesting Ronaldo's improvement formed part of a wider Real recovery.
"Cristiano has improved, as the team has also improved," he explained.
"His five goals are good for everyone, for him and for the team in the next few games.
"We are naturally happy, but it was only one game. We have another important game on Wednesday [against Rayo Vallecano].
"In this moment the team is very good. Last year we were not as good physically as we are now.
"We must highlight how the team has returned to playing as we want. It was important to win, and to play well, and we've done that."
Amid Ronaldo's heroics, James Rodriguez made his first appearance since February following a broken metatarsal.
The Colombian replaced suspended midfielder Isco with Ancelotti acknowledging he faces some tricky decisions when all his players are available.
"We will have to see - I cannot put in 12," the Italian added.
"Whoever is not at 100 per cent will not play.
"James has had a very good game but it wasn't noticeable that he was away for two months."
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