Assad Ghanem, a politics professor at Haifa University, told Al Jazeera: "Trump has given a legitimacy to the right's Messianic agenda. He has adopted the language of the extreme right on Jerusalem -- that it is Israel's eternal, united capital. The far-right will declare this a victory."
In parallel, Trump's seal of approval for Israel's takeover of Jerusalem is likely to intensify the city's religious symbolism for Jews -- and the importance of Israeli sovereignty over al-Aqsa Mosque compound, Ghanem noted.
In recent years, a growing number of rabbis have been overturning a centuries-old consensus that al-Aqsa compound is off-limits to Jews because it was not known where the ruins of an earlier Jewish temple lay. In Jewish tradition, it is forbidden to walk over an inner sanctum, known as the Holy of Holies.
Today, Jews regularly enter the compound and some even pray there. Settler rabbis and far-right government ministers have called for dividing the compound between Israelis and Palestinians, creating huge tensions with Palestinians.
Meanwhile, a once-fringe movement of Jewish supporters who wish to destroy the mosque to rebuild the ancient Jewish temple in its place, are gradually moving into the mainstream. Trump's move will be a shot in the arm to their ambitions and their credibility, said Sheen, who has studied the temple movements.
He pointed out that immediately after Trump's declaration, these groups had uploaded a cartoon of Trump standing in al-Aqsa compound, in front of the golden-topped Dome of the Rock, imagining the Jewish temple in its place. Trump is shown saying in Hebrew: "This is the perfect spot!"
Sheen said: "This will be treated as a call to arms by these groups."
Will the US recognition of Jerusalem as Israel's capital have similarly dramatic long-term effect on Palestinians' public opinion? Analysts believe it will. The lack of an outpouring of significant anger -- even after Palestinian leaders called for three days of rage last week -- could be deceptive.
Israeli analysts have suggested that there is often what they term an "incubation period" -- a delay between a major change in Israel's favor and a popular reaction from Palestinians. That was true of the second Intifada, which came months after the collapse of the Camp David summit.
An expectation of knee-jerk anger to Trump's decision may be misplaced, say analysts. The decision may result in a slower and much deeper process of adjustment to the new reality.
"Palestinians will now have to abandon the old tools of national struggle, because they have been shown to be ineffective. We need new tools of resistance, and that will require a grassroots struggle. We need a return to mass protests," Jabareen said.
Ghanem noted the danger that, with the likely growth of a Jewish religious extremism in Israel and among the settlers, some Palestinians might drift towards violence.
But he expected that a more significant trend would be Palestinians reassessing the end goal of their struggle and opting for mass civil disobedience.
"The two-state solution is obviously now finished, and that is likely to mobilize a new generation to struggle for a single state," he said. "Activists and the leadership will need to rebuild Palestinian nationalism."
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