After their heroics in midweek, coming from behind to win on penalties against Armadale Thistle in the King Cup’s quarter-final, a depleted Pace side lost out to the Borders outfit.
An early wonder-strike from Gary Windram put the hosts ahead.
Two goals from attacker Sam Colley put Smith’s side ahead but they weren’t enough to take something from the match, with a stirring late comeback sealing all three points for Coldstream.
Windram and second-half substitute Bailey Paterson netted in the final 15 minutes to turn the match on its head.
Smith told the Herald: “I actually thought we played really well on the day despite the side we had out, which was really depleted due to injuries and fatigue.
“The boys have given everything over the past couple of weeks, and when it gets to this time of year, that happens and we were very unlucky on the day.
“We’ve been making up the team with some of our under-20s recently and I think you could see that at some moments.
“We got ourselves 2-1 up but Coldstream had to win to give themselves a chance of finishing in the top half of the table and I think you could see that.
“Having a 17-year-old start the game was great to see and we did fine, to be honest. On another day we would have won.
“The one frustration for me is that I knew deep down that Leith were going to drop points again, and they did, which is annoying, because if we had picked up points on Saturday, we would have been in with a shout of second.
“They play Haddington and I think we would have finished second, to be honest, but it is what it is.”
The Pace round off the league season with a home match against third-bottom Tweedmouth Rangers, and Smith wants his side to go out with a victory.
“It’s important to me that we finish the league strongly and get three points,” he said.
“We need to try and put on a show because it is our last home game of the campaign too and we want to set up this semi-final nicely.
“All that matters now is that we don’t pick up any other injuries or knocks going into this cup match.
“We aren’t expecting to turn up and win. If we don’t perform to our levels, we will not get the result we want and we don’t want to take a confidence knock.”
Of the season as a whole, he added that a third-placed finish would be an excellent achievement for his side.
He said: “To finish in the top three is a good year for us and we are only going to get better. I really want to keep working with this group because they have given me everything this year.
“We could have been higher up if we had taken more chances, and we’ve missed a lot of penalties and other big match moments like that haven’t gone our way.”