1- Netanyahu has an election coming up, needs to look tough on Hizbullah & Iran without a war.
2- Nasrallah needs to look tough on Israel without provoking a war; very broke these days and needs some cash -- not time for a major war.
Resolution: save appearances
1- Netanyahu hit Dhahiya with drones claiming to neutralize a major Hizbullah tech project to make precision missiles
2- Nasrallah fires a few missiles & bullets at dummy israeli soldiers & empty armored ambulance
3- Bloodshed at a minimum
4- Move on