diff --git a/compiler/src/dotty/tools/dotc/printing/SyntaxHighlighting.scala b/compiler/src/dotty/tools/dotc/printing/SyntaxHighlighting.scala
index a4f3d0a522ae..08a34a2e9fbc 100644
--- a/compiler/src/dotty/tools/dotc/printing/SyntaxHighlighting.scala
+++ b/compiler/src/dotty/tools/dotc/printing/SyntaxHighlighting.scala
@@ -42,18 +42,19 @@ object SyntaxHighlighting {
     'q' :: 'r' :: 's' :: 't' :: 'u' :: 'v' :: 'w' :: 'x' :: 'y' :: 'z' :: Nil
 
   private val typeEnders =
-   '{'  :: '}' :: ')' :: '(' :: '[' :: ']' :: '=' :: ' ' :: ',' :: '.' ::
-   '\n' :: Nil
+   '{'  :: '}' :: ')' :: '(' :: '[' :: ']' :: '=' :: ' ' :: ',' :: '.' :: '|' ::
+   '&' :: '\n' :: Nil
 
   def apply(chars: Iterable[Char]): Iterable[Char] = {
     var prev: Char = 0
     var remaining  = chars.toStream
     val newBuf     = new StringBuilder
-    var lastToken  = ""
+    var lastValDefToken  = ""
 
     @inline def keywordStart =
       prev == 0    || prev == ' ' || prev == '{' || prev == '(' ||
-      prev == '\n' || prev == '[' || prev == ','
+      prev == '\n' || prev == '[' || prev == ',' || prev == ':' ||
+      prev == '|'  || prev == '&'
 
     @inline def numberStart(c: Char) =
       c.isDigit && (!prev.isLetter || prev == '.' || prev == ' ' || prev == '(' || prev == '\u0000')
@@ -289,6 +290,23 @@ object SyntaxHighlighting {
         case _ => false
       }
 
+      val valDefStarterTokens = "var" :: "val" :: "def" :: "case" :: Nil
+
+      /** lastValDefToken is used to check whether we want to show something
+       *  in valDef color or not. There are only a few cases when lastValDefToken
+       *  should be updated, that way we can avoid stopping coloring too early.
+       *  eg.: case A(x, y, z) => ???
+       *  Without this function only x would be colored.
+       */
+      def updateLastToken(currentToken: String): String =
+        (lastValDefToken, currentToken) match {
+          case _ if valDefStarterTokens.contains(currentToken) => currentToken
+          case (("val" | "var"), "=") => currentToken
+          case ("case", ("=>" | "class" | "object")) => currentToken
+          case ("def", _) => currentToken
+          case _ => lastValDefToken
+        }
+
       while (remaining.nonEmpty && !delim(curr)) {
         curr = takeChar()
         if (!delim(curr)) sb += curr
@@ -298,12 +316,12 @@ object SyntaxHighlighting {
       val toAdd  =
         if (shouldHL(str))
           highlight(str)
-        else if (("var" :: "val" :: "def" :: "case" :: Nil).contains(lastToken))
+        else if (valDefStarterTokens.contains(lastValDefToken) && !List("=", "=>").contains(str))
           valDef(str)
         else str
       val suffix = if (delim(curr)) s"$curr" else ""
       newBuf append (toAdd + suffix)
-      lastToken = str
+      lastValDefToken = updateLastToken(str)
       prev = curr
     }
 
diff --git a/compiler/test/dotty/tools/dotc/printing/SyntaxHighlightingTests.scala b/compiler/test/dotty/tools/dotc/printing/SyntaxHighlightingTests.scala
new file mode 100644
index 000000000000..7166d3cb0db1
--- /dev/null
+++ b/compiler/test/dotty/tools/dotc/printing/SyntaxHighlightingTests.scala
@@ -0,0 +1,98 @@
+package dotty.tools.dotc.printing
+
+import org.junit.Assert._
+import org.junit.Test
+
+/** Adapted from Ammonite HighlightTests
+ */
+class SyntaxHighlightingTests {
+  import SyntaxHighlighting._
+
+  private def test(source: String, expected: String): Unit = {
+    val highlighted = SyntaxHighlighting.apply(source)
+      .mkString
+      .replace(NoColor,         ">")
+      .replace(CommentColor,    "<C|")
+      .replace(KeywordColor,    "<K|")
+      .replace(ValDefColor,     "<V|")
+      .replace(LiteralColor,    "<L|")
+      .replace(StringColor,     "<S|")
+      .replace(TypeColor,       "<T|")
+      // .replace(AnnotationColor, "<A|") // is the same color as type color
+
+    if (expected != highlighted) {
+      // assertEquals produces weird expected/found message
+      fail(s"expected: $expected but was: $highlighted")
+    }
+  }
+
+  @Test
+  def comments = {
+    test("//a", "<C|//a>")
+    test("/** a */", "<C|/** a */>")
+    test("/* a */", "<C|/* a */>")
+  }
+
+  @Test
+  def types = {
+    test("type Foo = Int", "<K|type> <T|Foo> = <T|Int>")
+  }
+
+  @Test
+  def literals = {
+    test("1", "<L|1>")
+    // test("1L", "<L|1L>")
+  }
+
+  @Test
+  def strings = {
+    // For some reason we currently use literal color for string
+    test("\"Hello\"", "<L|\"Hello\">")
+  }
+
+  @Test
+  def annotations = {
+    test("@tailrec", "<T|@tailrec>")
+  }
+
+  @Test
+  def expressions = {
+    test("val x = 1 + 2 + 3", "<K|val> <V|x> = <L|1> + <L|2> + <L|3>")
+  }
+
+  @Test
+  def valDef = {
+    test("val a = 123", "<K|val> <V|a> = <L|123>")
+    test("var b = 123 /*Int*/", "<K|var> <V|b> = <L|123> <C|/*Int*/>")
+    test("""var c = "123" // String""", """<K|var> <V|c> = <L|"123"> <C|// String>""")
+    test("var e:Int = 123;e", "<K|var> <V|e>:<T|Int> = <L|123>;e")
+    test("def f = 123", "<K|def> <V|f> = <L|123>")
+    test("def f1(x: Int) = 123", "<K|def> <V|f1>(x: <T|Int>) = <L|123>")
+    test("def f2[T](x: T) = { 123 }", "<K|def> <V|f2>[<T|T>](x: <T|T>) = { <L|123> }")
+  }
+
+  @Test
+  def patternMatching = {
+    test("""val aFruit: Fruit = Apple("red", 123)""",
+      """<K|val> <V|aFruit>: <T|Fruit> = <T|Apple>(<L|"red">, <L|123>)""")
+    test("""val Apple(color, weight) = aFruit""",
+      """<K|val> <T|Apple>(<V|color>, <V|weight>) = aFruit""")
+    test("""case Apple(_, weight) => println(s"apple: $weight kgs")""",
+      """<K|case> <T|Apple>(<V|_>, <V|weight>) <T|=>> println(s<L|"apple: <V|$weight <L|kgs">)""")
+    test("""case o: Orange => println(s"orange ${o.weight} kgs")""",
+      """<K|case> <V|o>: <T|Orange> <T|=>> println(s<L|"orange <V|${o.weight}<L| kgs">)""")
+    test("""case m @ Melon(weight) => println(s"melon: ${m.weight} kgs")""",
+      """<K|case> <V|m> @ <T|Melon>(<V|weight>) <T|=>> println(s<L|"melon: <V|${m.weight}<L| kgs">)""")
+  }
+
+  @Test
+  def unionTypes = {
+    test("type A = String|Int| Long", "<K|type> <T|A> = <T|String>|<T|Int>| <T|Long>")
+    test("type B = String |Int| Long", "<K|type> <T|B> = <T|String> |<T|Int>| <T|Long>")
+    test("type C = String | Int | Long", "<K|type> <T|C> = <T|String> | <T|Int> | <T|Long>")
+    test("type D = String&Int& Long", "<K|type> <T|D> = <T|String>&<T|Int>& <T|Long>")
+    test("type E = String &Int& Long", "<K|type> <T|E> = <T|String> &<T|Int>& <T|Long>")
+    test("type F = String & Int & Long", "<K|type> <T|F> = <T|String> & <T|Int> & <T|Long>")
+    test("fn[String|Char](input)", "fn[<T|String>|<T|Char>](input)")
+  }
+}
diff --git a/compiler/test/dotty/tools/dotc/reporting/SyntaxHighlightingTests.scala b/compiler/test/dotty/tools/dotc/reporting/SyntaxHighlightingTests.scala
deleted file mode 100644
index 35f81e43263e..000000000000
--- a/compiler/test/dotty/tools/dotc/reporting/SyntaxHighlightingTests.scala
+++ /dev/null
@@ -1,62 +0,0 @@
-package dotty.tools.dotc.printing
-
-import org.junit.Assert._
-import org.junit.Test
-
-/** Adapted from Ammonite HighlightTests
- */
-class SyntaxHighlightingTests {
-  import SyntaxHighlighting._
-
-  private def test(source: String, expected: String): Unit = {
-    val highlighted = SyntaxHighlighting.apply(source)
-      .mkString
-      .replace(NoColor,         ">")
-      .replace(CommentColor,    "<C|")
-      .replace(KeywordColor,    "<K|")
-      .replace(ValDefColor,     "<V|")
-      .replace(LiteralColor,    "<L|")
-      .replace(StringColor,     "<S|")
-      .replace(TypeColor,       "<T|")
-      // .replace(AnnotationColor, "<A|") // is the same color as type color
-
-    if (expected != highlighted) {
-      // assertEquals produces weird expected/found message
-      fail(s"expected: $expected but was: $highlighted")
-    }
-  }
-
-  @Test
-  def comments = {
-    test("//a", "<C|//a>")
-    test("/** a */", "<C|/** a */>")
-    test("/* a */", "<C|/* a */>")
-  }
-
-  @Test
-  def types = {
-    test("type Foo = Int", "<K|type> <T|Foo> = <T|Int>")
-  }
-
-  @Test
-  def literals = {
-    test("1", "<L|1>")
-    // test("1L", "<L|1L>")
-  }
-
-  @Test
-  def strings = {
-    // For some reason we currently use literal color for string
-    test("\"Hello\"", "<L|\"Hello\">")
-  }
-
-  @Test
-  def annotations = {
-    test("@tailrec", "<T|@tailrec>")
-  }
-
-  @Test
-  def expressions = {
-    test("val x = 1 + 2 + 3", "<K|val> <V|x> = <L|1> + <L|2> + <L|3>")
-  }
-}