The Aussie men failed to progress out of Group C to the quarter-finals despite a super start to their Olympic campaign that included a sensational 2-0 victory over two-time gold medallists Argentina and a narrow 1-0 loss to Spain.
That left them requiring a draw against Egypt to advance out of the group stage and it was evident what the game-plan was in the first 45 minutes as the Olyroos sat back, and absorbed pressure, instead of pursuing the free-flowing attack that led to such a strong start at the Tokyo Games.
Arnold's conservative approach to the match proved costly as Egypt pounced on the counter attack and found soft spots to exploit in the tiring Olyroos defence.
Ahmed Rayan gave the Egyptians a 1-0 lead moments before halftime after Ramadan Sobhi nutmegged towering Aussie defender Harry Souttar to tee up Rayan to score.
Then, despite Australia finding a spark through electric Socceroo Daniel Arzani who was subbed on in the second half, Amar Hamdi's goal late in the game put the result beyond doubt.
There were questions as to why Arzani did not start the match, when his introduction alongside Keanu Baccus in the second half so obviously provided a much-needed boost in the final third.
The former Celtic star immediately lifted those around him, made defenders scramble and peppered the Egyptian goalkeeper Mohammed El Shenaway, who was impressive throughout the match. It was too little too late though.
The Olyroos were without three key players - Riley McGree, Nathaniel Atkinson and Mitch Duke - due to suspension, but they also looked fatigued in tough, hot conditions, playing their third match in a week.
"Did those two games take it out of us? Maybe," Arnold said after the match.
"But as I said, I couldn't have been prouder.
"In the past, the Olympics have developed and created a lot of national team players for the Socceroos and that was the reason I took this job on. It was to do that and I do feel I walk away from here with much more depth now for the Socceroos."
Football-loving Australians watching the action back home weren't so upbeat.
Socceroos great Ned Zelic was scathing in his summary of the Olyroos' efforts.
"Naive/passive defending in crucial moments from the Olyroos," he tweeted.
"Too many errors on the ball. Egypt technically better, smoother in possession. Frustrating end to the Olyroos' Olympics campaign."
Legendary former Socceroos goalkeeper Mark Bosnich lamented a "wasted" opportunity after a fantastic start in Tokyo against Argentina.
"So in the end the opening game was wasted," Bosnich tweeted,.
"Setting up defensively against a team who hadn't scored yet all tournament is a recipe for sowing seeds in [your] players' minds that 'we cannot be our true selves', leads to doubt."
Arnold copped a lot of the critcism from football pundits and fans alike for the tactics used, creatively dubbed 'Arnieball'.
The concensus though appeared to be that the Olyroos' Tokyo Olympics campaign was simply yet another disappointing chapter in Australian football which consistently provides flashes of promise and hope, only to fall frustratingly short of reaching its full potential.
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