diff --git a/lib/ace/mode/logicql.js b/lib/ace/mode/logicql.js
index bc0c16c7..f63f1d0e 100644
--- a/lib/ace/mode/logicql.js
+++ b/lib/ace/mode/logicql.js
@@ -35,8 +35,9 @@ var oop = require("../lib/oop");
 var TextMode = require("./text").Mode;
 var Tokenizer = require("../tokenizer").Tokenizer;
 var LogicQLHighlightRules = require("./logicql_highlight_rules").LogicQLHighlightRules;
-// TODO: pick appropriate fold mode
-var FoldMode = require("./folding/cstyle").FoldMode;
+var FoldMode = require("./folding/coffee").FoldMode;
+var TokenIterator = require("ace/token_iterator").TokenIterator;
+var Range = require("ace/range").Range;
 
 var Mode = function() {
     var highlighter = new LogicQLHighlightRules();
@@ -48,6 +49,72 @@ oop.inherits(Mode, TextMode);
 (function() {
     this.lineCommentStart = "//";
     this.blockComment = {start: "/*", end: "*/"};
+
+    this.getNextLineIndent = function(state, line, tab) {
+        var indent = this.$getIndent(line);
+        var match = line.match();
+        if (/(-->|<--|<-|->)\s*$/.test(line))
+            indent += tab;
+        return indent;
+    };
+
+    this.checkOutdent = function(state, line, input) {
+        if (input !== "\n" && input !== "\r\n")
+            return false;
+            
+        if (!/^\s+/.test(line))
+            return false;
+
+        return true;
+    };
+
+    this.autoOutdent = function(state, doc, row) {
+        var prevLine = doc.getLine(row);
+        var match = prevLine.match(/^\s+/);
+        var column = prevLine.lastIndexOf(".");
+        if (!match || row == 0 || column == -1) return 0;
+
+        var line = doc.getLine(row + 1);
+        var startRange = this.getMatching(doc, {row: row, column: column});
+        if (!startRange || startRange.start.row == row) return 0;
+
+        column = match[0].length;
+        var indent = this.$getIndent(doc.getLine(startRange.start.row));
+        doc.replace(new Range(row + 1, 0, row + 1, column), indent);
+    };
+
+    this.getMatching = function(session, row, column) {
+        if (row == undefined)
+            row = session.selection.lead
+        if (typeof row == "object") {
+            row = row.row;
+            column = row.column;
+        }
+
+        var startToken = session.getTokenAt(row, column);
+        var KW_START = "keyword.start", KW_END = "keyword.end";
+        var tok;
+        
+        if (startToken.type == KW_START) {
+            var it = new TokenIterator(session, row, column);
+            it.step = it.stepForward;
+        } else if (startToken.type == KW_END) {
+            var it = new TokenIterator(session, row, column);
+            it.step = it.stepBackward;
+        } else
+            return;
+
+        while (tok = it.step()) {
+            if (tok.type == KW_START || tok.type == KW_END)
+                break;
+        }
+        if (!tok)
+            return;
+
+        var col = it.getCurrentTokenColumn();
+        var row = it.getCurrentTokenRow();
+        return new Range(row, col, row, col + tok.value.length);
+    };
     // Extra logic goes here.
 }).call(Mode.prototype);
 
diff --git a/lib/ace/mode/logicql_highlight_rules.js b/lib/ace/mode/logicql_highlight_rules.js
index 601c5bb2..eb59eda4 100644
--- a/lib/ace/mode/logicql_highlight_rules.js
+++ b/lib/ace/mode/logicql_highlight_rules.js
@@ -72,26 +72,17 @@ var LogicQLHighlightRules = function() {
            regex: '`[a-zA-Z_:]+(\\d|\\a)*\\b',
            //LogicBlox Symbol
             },
-         { token: 'keyword.other', regex: '->', comment: 'Constraint' },
-         { token: 'keyword.other',
-           regex: '-->',
-           //Level 1 Constraint
-            },
-         { token: 'keyword.other', regex: '<-', comment: 'Rule' },
-         { token: 'keyword.other', regex: '<--', comment: 'Level 1 Rule' },
-         { token: 'keyword.other', regex: '\\.', comment: 'Terminator' },
-         { token: 'keyword.other', regex: '!', comment: 'Negation' },
-         { token: 'keyword.other', regex: ',', comment: 'Conjunction' },
-         { token: 'keyword.other', regex: ';', comment: 'Disjunction' },
-         { token: 'keyword.operator',
-           regex: '<=|>=|!=|<|>',
-           //Equality
-            },
+         { token: 'keyword.start', regex: '->',  comment: 'Constraint' },
+         { token: 'keyword.start', regex: '-->', comment: 'Level 1 Constraint'},
+         { token: 'keyword.start', regex: '<-',  comment: 'Rule' },
+         { token: 'keyword.start', regex: '<--', comment: 'Level 1 Rule' },
+         { token: 'keyword.end',   regex: '\\.', comment: 'Terminator' },
+         { token: 'keyword.other', regex: '!',   comment: 'Negation' },
+         { token: 'keyword.other', regex: ',',   comment: 'Conjunction' },
+         { token: 'keyword.other', regex: ';',   comment: 'Disjunction' },
+         { token: 'keyword.operator', regex: '<=|>=|!=|<|>', comment: 'Equality'},
          { token: 'keyword.other', regex: '@', comment: 'Equality' },
-         { token: 'keyword.operator',
-           regex: '\\+|-|\\*|/',
-           //Arithmetic operations
-            },
+         { token: 'keyword.operator', regex: '\\+|-|\\*|/', comment: 'Arithmetic operations'},
          { token: 'keyword', regex: '::', comment: 'Colon colon' },
          { token: 'support.function',
            regex: '\\b(agg\\s*<<)',