Indirect talks between Israel and Hamas are being held in the Egyptian tourist resort of Sharm El-Sheik, where the mediating countries Egypt and Qatar are also present. Turkish delegates are also expected to join the talks on Wednesday, writes AFP.
On the agenda is Trump's 20-point plan for peace.
A representative of Hamas states that there is some optimism among the parties about being able to reach a ceasefire. Lists of prisoners and hostages who will be released if an agreement is reached during the negotiations have been exchanged, says Hamas representative Taher al-Nunu, reports Reuters.
Previously, it has been reported that the talks are taking place in a positive spirit. Donald Trump said on Tuesday that there is a "real chance" that an agreement will be reached and that the US will do "everything possible" to prevent Israel from resuming the war if the parties succeed in reaching a ceasefire.
The first phase of the peace process involves Hamas releasing its hostages, in exchange for Israel releasing a large number of high-profile prisoners and the country's forces withdrawing inside the Gaza Strip.
On Tuesday, it was two years since the terrorist-listed Hamas large-scale attack on Israel, which triggered the war. Over 67,000 Gaza residents have been killed in Israel's bombardment, according to Hamas-controlled authorities who do not distinguish between civilians and combatants.