After 10 days of strikes and counter-strikes, a sense of calm appeared to have returned to the tense Israeli-Gaza border over the weekend, despite an air strike on Sunday that killed two members of Islamic Jihad's military wing.
Gaza's armed groups have agreed to observe a period of calm if Israel reciprocates, but a rocket fell in Israel late on Tuesday, prompting another air strike overnight which killed a third Islamic Jihad militant and threatened to see a return of the tit-for-tat violence.
The violence has also been interpreted as a message to Palestinian president Mahmud Abbas, whose secular Fatah party is trying to end a bitter dispute with Gaza's Islamist Hamas rulers, with one official in Ramallah suggesting the unrest was a calculated attempt to thwart unity talks.
The latest round of clashes began on March 16 when a rocket landed in an open area inside Israel, without causing casualties or damage.
Within hours, the Israeli air force hit back, killing two militants from the Ezzedine al-Qassam Brigades, Hamas's armed wing, in what some saw as a disproportionate response.
A Hamas official quoted by the International Crisis Group (ICG) said the move violated the "reasonable rules of the game: that when Palestinian projectiles hit open space ... Israel aims at open space in response."
Two days later, Hamas militants responded, firing a barrage of around 50 mortars at the Jewish state in the fiercest bombardment in two years.
"Israel sent a strong message to Hamas and, in turn, got one from Hamas -- (that its) power of response and resistance have developed quite substantially," said Naji Sharab, a political science professor at Gaza's Al-Azhar University.
Hamas let itself be drawn into a confrontation "banking on the fact that Israel will not unleash a new war because the regional environment won't permit it," he said.
The big fear is that Israel will launch another massive operation along the lines of Operation Cast Lead, a devastating 22-day war which began in December 2008 with the aim of ending rocket fire from Gaza.
The war killed 1,400 Palestinians, more than half of them civilians, and 13 Israelis, 10 of them soldiers.
But Israel feels on the defensive and knows its international standing has been weakened over the collapse in peace talks, as well as the rising tide of support for a declaration Palestinian statehood, an ICG report said.
And given the wave of turmoil sweeping the region, Israel knows it cannot push too far and must remain "under the international radar," a former Israeli defence official told the ICG.
"This state of affairs arguably leads Israel to tread cautiously so as not to further inflame the situation; it also knows that the last thing the US administration wants is an Israeli-Palestinian war that might negatively affect regional developments," the ICG said.
Hamas has also made it clear it is not ready for a new war with Israel, with prime minister Ismail Haniya saying last week that the Islamist group was doing what it could "in order to avoid dragging Gaza into a new confrontation with the Israeli occupier."
But few in Gaza see the shaky truce arrangement lasting.
Sharab says the de facto truce is fragile because it is not based on security or political considerations, and "could collapse with the firing of a rocket from Gaza or the assassination of a Palestinian leader."
Political scientist Mukhaimer Abu Saada says Hamas has no long-term strategy regarding the truce and has even "opened a limited front" with Israel to distract from Gaza's political and economic woes, not to mention from the growing calls for Hamas and Fatah to reconcile their differences.
Two weeks ago, Abbas accepted a Hamas invitation to travel to Gaza for unity talks, but the violence has forced the planned visit onto the back-burner, leading some in the Palestinian Authority to suggest that Hamas provoked a fight with Israel in order to scotch reconciliation attempts.
"Last week, a war was invented in the Gaza Strip with the blessing of Israel," said senior Palestinian official Yasser Abed Rabbo.
"All these attempts that aim at shuffling the cards and spoiling the president's initiative (for reconciliation) should stop," he said.
Israel has also made clear it does not look favourably upon attempts to patch up ties between the Fatah-dominated Palestinian Authority and its Islamist rivals.
"We hear in recent days that the Palestinian Authority is thinking of uniting with Hamas," Israeli Prime Minister Benjamin Netanyahu said on Monday.
"Well, I say to them something very simple: you can’t have peace with Israel and Hamas. It’s one or the other, but not both."
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