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Currently you can use left arrow key to collapse a folder. If the folder is already collapsed or the item is a file, it will move the cursor up to the parent folder. This behavior will stop at the top level. But if current page is presenting a sub folder, it should scope up to the parent page. Just like clicking on the tail of the bread crumb.
fixed with http://git.eclipse.org/c/orion/org.eclipse.orion.client.git/commit/?id=01e446ed7c1d417586afecf2cb7b5b12738d5b28.