Wales under-21 coach Chris Davey paid tribute to his side, inspired by Newport prop Rhys Thomas, (pictured, left) but rued their luck after playing some superb rugby.
"I think if you take the scores out of it we dominated," he said. "We created a couple of chances and didn't put them away.
"In terms of performance everyone was very competitive - they weren't 50 points better than us," he said.
Davey took heart from the way his side has improved in comparison with the southern hemisphere rugby superpowers: "I'm just pleased we closed the gap on these, and on this evidence it appears we have.
"Last year we were blown away. They were far too powerful in the contact areas for us," he said. Davey was disappointed that by virtue of two bonus points, one against Wales, Argentina go through at his side's expense, setting up a play-off against England.
"We knew the rules coming into the tournament. We haven't come here to play teams like England. We wanted to face South Africa, New Zealand and Australia."
But he added: "Any game against the old enemy is something to build from. Our record against them in the past few years has been pretty good, but it will be the team that recovers best that goes in as favourites."
The Wales coach was unclear on the sending off of James Malpas: "I was cheering our try which was disallowed. Strange that the touch judge 15 yards away didn't see it, but the one 60 yards away did."
Davey singled out Newport prop Rhys Thomas for praise after a typically bullish performance.
"He has got better and better with every game. I thought he was outstanding today," he said.
He added: "Luke Charteris has huge talent, is a great lineout target and he is great around the field. Behind the scrum Nicky Robinson ran the show."
Man of the match Thomas said: "I just can't get over how unlucky we were. It was a flattering scoreline.
"I think that since we won the grand slam we wanted to test ourselves against the southern hemisphere," he said.
"To be honest, I think on a different day we would have run South Africa close."
The defeat means that Wales will now be playing for a finishing place of fifth to eighth and tackle, among others, England in their matches.
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