AFAIK, it is not looking at longer term fatigue like you mention. It will likely suggest Endurance level work if you have had hard days before, but won’t lead to a “recovery week” in the sense that we are used to seeing in an actual training plan.
TN is meant as a more loose and less structured approach, which means it lacks “goals” and the related aspects of an actual training plan, like periodization. If people want that, they are better served with applying a training plan in one of the two main ways in TR (Plan Builder or manually added).