With both candidates -- Muhammad Morsi of the Muslim Brotherhood and former General Ahmed Shafiq -- claiming victory, analysts say the postponement risks undermining public trust in the process.
The situation could become explosive, says Shashank Joshi, a regional analyst with London-based Chatham House.
"The delay really is a lose-lose situation," he told RFE/RL. "It erodes trust in the military further than is already the case but if Ahmed Shafiq, the establishment candidate comes out on top now, it will be interpreted fairly straightforward as a case of a rigged vote, or an annulled outcome in favor of the army's own man. I think that will promote real anger and frustration, potentially even onto the street."
Distrust between the two camps has deepened as the military has taken over many of the powers of the parliament after it was dissolved a week ago.
The Supreme Constitutional court – composed of judges appointed under deposed former President Hosni Mubarak – dissolved the Muslim Brotherhood dominated parliament over charges parliamentary elections were unfair.
With the empty parliament building now ringed by troops, the Muslim Brotherhood has called the dissolution a "soft coup" by the Mubarak-era establishment. No date for new legislative elections has been announced.
Adding mystery to events is the fate of Mubarak himself. He was pronounced clinically dead this week by some state media, only to be declared in a coma later by others.
His return to the hospital has fueled popular sentiment that the military is protecting its former leader from punishment despite his conviction over the deaths of hundreds of protestors during the Arab Spring protests that toppled him in February last year.
The big question in Egypt now is whether the establishment's steps in recent days mean it could accept Morsi as president after giving itself the means to limit his authority.
According to Maha Azzam, another regional expert with Chatham House, the most important power the generals took from the dissolved parliament was full control over the drafting of the country's post-Mubarak constitution.
"They can choose the members of the assembly which draws up the constitution and in addition to that they have veto power," he says. "In a sense they are saying 'we are the arbiters of the political process in Egypt' as well as the constitution writing, which is so fundamental to the democratic process going forward."
Showdown Sure To Continue
Both the military and the new president have the power to object to provisions in the draft constitution by asking for arbitration from the Supreme Constitutional Court. But Azzam says the fact that the Court's judges are all Mubarak-era appointees turns that right to arbitration into a de facto veto power for the establishment.
If Morsi were ultimately to become president, his challenge would be how to push change from an office made and kept subordinate by a reluctant military.
He would not be able to simply fire generals or appoint new ones because the military this week also preemptively stripped the presidency of any power to do that.
Whether Morsi or Shafiq becomes president, the showdown between the Muslim Brotherhood and the establishment is sure to continue.
Who wins the election will only help decide whether that showdown takes place within Egypt's governing institutions or on the streets.
The speaker of the dissolved parliament signaled as much this week as he abandoned the building.
Saad al-Katatni insisted the Muslim Brotherhood would not fight back with violence as Islamists did in Algeria after a cancelled 1992 vote, launching a decade of civil war.
"We are fighting a legal struggle via the establishment and a popular struggle in the streets," he said. "This is the ceiling. I see the continuation of the struggle in this way."