The history of the geographical region is extremely complex. Today's Israel occupies a portion of the original Jewish territory in the region. Prior to the arrival of Islam in the region around the 7th century AD, however, the resident Jewish and Arab populations had already been somewhat marginalised by invading conquerors such as the Roman Empire. Through the first two millenia AD, in fact, the Jewish and Arab populations had equally been dominated and manipulated by governments from outside the region (the British, the Russians, the French, the Americans, and so on).
As a dispassionate observer from outside the region and the religions in question (and yes, that includes Christianity), I have the impression that the rage on all sides is only partially directed at the populations that are being attacked. I think much of the rage is truly for all outsiders to the region -- something about which states like Iran are rather ironically more honest. Arabs, in particular Palestinians, prossibly consider the Israeli populace to be largely "outsiders" since the vast majority of them only immigrated to the region after 1948 and even though it is the Jews' ancestral homeland. The Jewish people perhaps consider the Muslims population to be "outsiders" since they arrived centuries after the area had already been established as a Jewish region.
That said, the Israelis may also be raging against the intolerance their predecessors dealt with elsewhere in the world, such as in Communist Russia and Nazi Germany.
Regardless of all of that, though, I perceive there are three elements at the centre this conflict that, seemingly, can be used to define most any military conflict anywhere in the world: religion, land and -- worst of all -- human beings.
I fear that nothing -- not even a Second Coming (since neither Jews nor Muslims believe there was a First Coming to begin with) -- nothing short of the annihilation of some or all of the parties directly involved, can resolve this situation. Sadly.
Disclaimer: this is only my personal opinion and not a verdict. I sincerely hope.