Firstly, though there is nearly always a subject, there is seldom any single meaning or setting in any poem. Much of the meaning that we find in poetry is subjective and related to our own associations and memories. When we argue what we think a poem is about, we use evidence from the text to support our point.

To help us understand this poem's meaning and potential setting, let's begin with the title. Duende is a noun that Merriam-Webster defines as "the power to attract through personal magnetism and charm." In Spanish, Portuguese, and Filipino folklore, the duende is a ghost or goblin. The term comes from the Spanish phrase dueño de casa, or "owner of the house." Often, the term applies when talking about flamenco music, especially when one wants to describe the magnetism, power, and pure emotion that a dancer gives off during a performance.

In Smith's poem, the object of interest appears to be a flamenco dancer. The music exists in them, "heavy in the throat," but they choose a form other than singing to express it:

They drag it out and with nails in their feet
Coax the night into being. Brief believing.
A skirt shimmering with sequins and lies.

The reference to "nails in their feet" describes the scraping sound that barefoot flamenco dancers often make. The reference to a flamenco dancer becomes visually clearer with the narrator's description of a "skirt shimmering with sequins." The "lies" may refer to the element of performance in which the dancer is both powerful and seductive, though this display may have nothing to do with who the person is in real life.

In the second section of the poem, Smith refers to a lineage of flamenco dancers:

And not just them. Not just
The ramshackle family, the tíos,
Primitos, not just the bailaor
Whose heels have notched
And hammered time
So the hours flow in place
Like a tin river, marking
Only what once was.

The speaker wants to connect with that lineage, but language and poetry are her only source of connection, despite their limitations in relation to the more dynamic form of dance:

And I hate to do it here.
To set myself heavily beside them.
Not now that they've proven
The body a myth, a parable
For what not even language
Moves quickly enough to name.

In the third section, there is some suggestion of a setting:

There is always a road,
The sea, dark hair, dolor.

These images are metonyms, or substitutions, for things that we experience during travel—or, more simply, as we journey through life. Dolor means pain or sadness in Spanish. Smith's preference for this term over its English translations is in keeping with her identification with the Spanish culture that has provided the narrator with the experience of flamenco.

It's possible that the narrator is on vacation in a Spanish-speaking place. Another voice, identified in italics, enters the poem at the very end:

They say you’re leaving Monday
Why can’t you leave on Tuesday?

The narrator, we learn, is in some place that is not home. She is asked why she can't stay longer, though this question is "[b]igger than itself" because it suggests possibilities beyond extending a trip. It could mean staying forever, immersing oneself in a culture and language that is not one's own. The latter is already occurring, in fact, as a result of the narrator sprinkling her story with Spanish words.

"Duende" is about the experience of convergence—that is, of seemingly unrelated beings, ideas, and moods coming together to form a new experience and a new idea. This experience can continue indefinitely, which is why the question about staying until Tuesday hovers in the air between the speaker and the intruding voice. That additional voice might also be the narrator's own thought—the little voice telling her to stay on and to become a part of that world, that strangeness, that she fears and loves.