"The board of directors and the players asked me to remain at the helm," Al-Ashri told FilGoal.com late on Wednesday.
"I decided to remain put after the board promised me they would reinforce the team in January."
Al-Ashri initially said he would resign after Hodoud lost 3-2 to Military Production in Tuesday's Egyptian Premier League game for their third successive match without a win.
The military club, who were one of the pre-season favorites to mount a serious challenge for the title, slipped to 12th place in the 16-team table with 16 points, four above the relegation zone.
Al-Ashri, who was Helmi Toulan's assistant before taking over at Hodoud following the latter's sacking in 2006, transformed the club into a top-four side rather than a mid-table team.
He led them to their first ever title when they beat ENPPI in last season's Egyptian Cup final.
Few months later, Hodoud caused a huge upset by beating Cairo giants Ahli in the Egyptian Super Cup.