Álvarez was unable to force through a move away from the Metropolitano before the transfer window closed, and with the market now shut, Simeone confirmed the Argentina international will be part of the squad travelling to face Athletic Club on Saturday.
"He's training very well. Tomorrow he'll be called up, he'll be part of the group that travels to Bilbao, and we're hoping for the best from him and all his teammates," Simeone said.
Asked whether the prolonged transfer saga had worn on him personally, the Atletico Madrid head coach was keen to look ahead rather than dwell on the summer.
"I always look from here forward. We clearly have a very exciting season with lots of challenges and possibilities, we'll go match by match hoping to do our best," he said.
He struck a similarly forward-looking tone when discussing Álvarez's situation directly.
"Life is full of opportunities, and this is an opportunity that presents itself to Julián to adjust things in his life," Simeone said. "We spend all our time learning and a lot of time judging. We all judge — we need to judge less and focus more on learning.
"This step will give him pure learning, and he has the chance to resolve things internally so that it makes him better, and so that we see him happy, which is what we want — for him to be content and score us goals, like [Paulo] Futre told us yesterday, because it's a nice message."
Simeone also addressed Marcos Llorente's decision to retire from international football with Spain, just weeks after winning the World Cup.
"Here with us, Marcos will play for as long as he decides. He's a very decisive person, with incredible clarity in his thinking — it's what he feels about his national team," Simeone said.
"I congratulate him, because it makes many of us stay longer in a place where we no longer feel at home, and he does what he feels. We're very happy with what he continues to give us as a person and a footballer."
On the transfer window as a whole, Simeone praised sporting director Mateu Alemany for the business completed.
"Mateu has done a great job — I'm happy with all the possibilities the club keeps giving me to keep working in the direction we want," he said, before turning to the club's newest signing, Jonathan David. "We need the player he was at Lille. We've spoken with him, he has characteristics that can help us, we need him to adapt as quickly as possible. We see him enthusiastic, eager, and we hope he gives us what he wants and what we expect of him."
Asked whether Atlético could genuinely compete with Real Madrid and Barcelona this season, Simeone was measured.
"This isn't going to change what's been happening for more than 15 or 20 years. Real Madrid and Barcelona, and those of us coming up behind them, try to get as close as possible so we can compete," he said.