Sundowns created a lot of opportunities but could not convert before they were punished by Victor Letsoalo in the last 22 minutes, as Celtic held on in the end to claim a 1-0 victory for a in the semi-finals.
Mngqithi explained that he was pleased with the application from his charges and they were just unlucky not to find the back of the net.
"When you drag it a little bit longer without scoring a goal, you dominate and create opportunities but you don't get clear chances even if you get those chances, you don't take them, normally in football you get punished," Mngqithi said on SuperSport TV after the match.
"It was just an unfortunate foul by Nyiko [Mobbie] and out of nothing, a goal was created [by Celtic] but I think in this game there were a lot of positives. I believe we're beginning to play the way I want the team to play.
"The coaches have worked very hard in trying to make sure that we have the right balance and the shape in midfield and to be honest we looked very good but when we got punished, what can you say, you can't say you played well when you didn't win the match," he said.
The former Golden Arrows coach went on to break down how he wants his team to play.
"We patiently wanted to keep the ball in midfield, create good moments, wait for the right moment to look for possibilities behind the defence, a lot of breaking the lines, which did not happen much from out 8s.
"In the second-half we started to see those moments a lot but better positional sense because when you're playing the shape we're playing, you expect to keep possession and not lose possession and don't expose yourself to counter-attacks and I think that's where we survived.
"Because there were scary moments when they won the ball, out of nothing...when we're casual on the ball, it creates moments for them but otherwise I believe we played very well, it was just unfortunate that we could not take the game," he went on.
"The chances we created, unfortunately with the offside of [Peter] Shalulile, we created some moments which could give us some goal, Gason [Sirino] had [a chance], 'Mshishi' [Themba Zwane] also had a chance on the far side, we had some very interesting moments, maybe one more touch could have resulted in a goal in some instances.
"But at times we were nervy, anxious, understandably when you're playing the first match of the season but I was impressed, there were a lot of positives in my opinion," he added.