You will only need, at most, two types/colors of yarn. One for the body of the angel pocket and another if you chose to add a contrasting border, in this case, a shell stitch.

In my example I used Red Heart Baby Econo Yarn (in Newborn Print) and did my border in Patons Beehive Baby Sport. I used a 5mm hook for both yarns, but you can used a 3.75 for the border if you prefer tighter shells verses the loose fluffy ones I prefer.

Any small Baby Yarn (Such RH Econo, Patons Baby Sport, Bernat Softee or Bernat Sport will do perfectly for the intended size) Using larger/small yarns and/or hooks will change the size of the finished item.