Strong-field ionization can induce electron motion in both the continuum and the valence shell of the parent ion. Here, we explore their interplay by studying laser-induced electron diffraction (LIED) patterns arising from interaction with the potentials of two-hole states of the xenon cation. The quantitative rescattering theory is used to calculate the corresponding photoelectron momentum distributions, providing evidence that the spin-orbit dynamics could be detected by LIED. We identify the contribution of these time-evolving hole states to the angular distribution of the rescattered electrons, particularly noting a distinct change along the backward scattering angles. We benchmark numerical results with experiments using ultrabroad and femtosecond laser pulses centered at \SI{3100}{nm}.