Cloak of Sidhe transformed by the touch of the undersea depths. [ Resists Water ] This cloak can be found at the Undersea City. In the area just outside the Old Capital 2 (go through the gate leading toward the Forgotten Palace) break the purple memory stone that appears after ridding the place of 3 Ascidias (the purple memory stone will appear only after all the folks in the Undersea City have been captured). The cloak will be in there. You will need a Thunder folk such as Ga-boi or Hobbledy to break it.