This pattern is ingenious. You basically knit a square, and it miraculously folds into a cute little pointed pixie hat! I used Arucania Ranco Multy yarn in color 308, and size 3 needles. I didn't follow the directions for the ties on the sides as written in the pattern, and instead just picked up 7 stitches on each side and did K1P1 ribbing for the ties. I learned about this great hat from soulemama - I adore her version of it and think it is so cute that it is too big for her baby. Mine is a little more form-fitting, but still cute! In the picture below, you can see the sides of the hat - the way it is knit forms a neat triangle pattern.
The hat is really great and stretchy, so it will fit Levi for a long time - at least the rest of the winter, which is what I was hoping for. He has already grown out of his first handknit wool hat, and I needed something for his little head now that we're starting to take more walks!