Points of disagreement: Kabbalah and Chasidism both have very lively fantasy elements, and I think the Midrash does as well, but the article writes them off as not normative. Well, they aren't part of the Judaism I grew up with (Conservative, which I think might be viewed as very toned down Misnaged (non-Chasidic) Orthodox Judaism. However, there are a fair number of Chasidic Jews (I don't know how many Jews are connected to the Kabbalah well enough to want to use it as fantasy elements but loosely enough that they'd be comfortable doing so) who could draw on their traditions, but either they aren't writing fantasy or it isn't getting to where the rest of us can see it.
Also, there's a substantial secular Jewish tradition, but it doesn't seem to be generating fantasy either.
I don't think the Holocaust has put a damper on the Jewish ability to write fantasy. "Where was the magic during the Holocaust?" might be in the back of potential authors' minds, but it's possible to write fantasy in which magic is discovered post-Holocaust, or set in a world which isn't connected to real history.
Speaking of fantasy where the rest of us can see it, the article reviews a contemporary Israeli fantasy which sounds like a lot of fun. I hope it's translated into English.
Sentence which might generate discussion: To put it crudely, if Christianity is a fantasy religion, then Judaism is a science fiction religion. If the former is individualistic, magical, and salvationist, the latter is collective, technical, and this-worldly. I'm not sure this is fair to either religion, but it'll probably stay in the back of my mind where I can see if it connects to anything.
Favorite sentence: As it happens, though, the author of these lines, Hagar Yanai, has recently attempted to fill this gap, along with a few other Israeli writers who have in the last few years begun to produce fantasy books—not magical realism or surrealism or postmodernism, but serious fantasy. Yay, us! The real fantasy, the serious fantasy, is the kind where the magic is unquestionably and literally part of the characters' world, and the world is at least intended to make logical sense.
Link, with a few comments about fantasy the article has missed, and a major contemporary Jewish fantasy writer.
Addendum: Many more Jewish fantasy writers are mentioned in the comments. The explanation for the lack of Jewish fantasy hitting it really big may be as simple as that very few writers manage it and Jews are a minority, so it could just be statistics.