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Textastic 1.1 i now available on the App Store.

New Features:
• Local web preview for html files
• It's now possible to hide the sidebar in landscape orientation
• The editor highlights the current line
• Saves and restores cursor position when switching files
• Supports TextExpander touch snippet expansion
• You can now manually select a syntax definition

• WebDAV server settings are now saved
• Additional keys are now automatically hidden when using a hardware keyboard
• Fixed issues with the Copy & Paste menu
• All supported file types are now registered for "Open In..."
• You can now delete the GettingStarted file
• Fixed some minor issues
There are a few things to consider here: You can use the pinch-to-zoom gesture to zoom out of the editor and quickly skim over the text. I don't want to fit the editor to the screen when doing that.

When you use a large font size, horizontal scrolling is probably what you want because otherwise it would wrap after just a few words.

I like to have a fixed word wrap position when coding to see when my lines are getting too long. (Guess I used a certain IDE too long where there is a vertical gray line at position 80 that reminds you to do a line break)

But I agree, this could be an editor option. I would probably have to disable zooming in this mode.
This is already implemented in 1.1 which should be available any time now.

Here's a list of changes:
Just received my Dock Connector-to-VGA adapter. Let's see if I can mirror the editor on an external display (beamer).
Well, this is an interesting read regarding US export regulations for encryption algorithms:

And this is just for using a HTTPS connection, not SSH. (the process is probably the same though)

The paperwork involved is quite heavy and takes a long time to complete:
This is fixed in 1.1 which is currently in review at Apple. It should hit the App Store very soon.

In this version, all supported file extensions are registered as text files in the system.
Well, I sure find it interesting :)
I've already asked Apple for permission to use the Monaco and/or Menlo font. They are they copyright owner of those fonts. The iOS developer support gave me a contact to ask. Unfortunately I didn't get an answer yet. That was a few weeks ago.

I also tried to disable anti-aliasing when drawing the characters. It seems like you can't disable it on iOS when using CoreGraphics to draw the glyphs.

The DejaVu font is very similar to Menlo. They are both based on Bitstream Vera. In Mac OS X 10.6 Snow Leopard, Monaco was replaced as the default Terminal font by Menlo: