Otavalo Market -- The market at Otavalo presents some of the best bargains in Ecuador and, just as important, some of the best people-watching. On Saturday, the city becomes one big shopping area. It's not just for tourists; Ecuadorians come here too, from miles away, to peddle and buy high-quality handmade goods. The Otavaleños are extremely friendly and helpful, and they wear beautiful traditional clothing. Overall, this is one of the most colorful markets in Ecuador and the handicrafts are of excellent quality.

Some of the most interesting buys include handmade alpaca sweaters, soft alpaca scarves, wool fedoras, colorful straw bags, hand-embroidered blouses, ceramics, tapestries, fresh pineapple, and llamas. Yes, llamas. Early in the morning on Saturday, there is an animal market, where you can exchange your cow for a llama or simply buy a dozen chickadees. To get to the animal market from the main plaza, walk down Sucre or Bolívar to Morales. Take a right on Morales and walk straight for about 5 blocks and cross over the bridge. Turn right after the bridge and then take a left at the next main street. The animal market is about half a block up. Get here early (around 7 or 8am) because the market closes down at 10am. There is also an excellent fresh produce market in Plaza 24 de Mayo.

Saturday is market day, but there is a small market every day in Plaza de los Ponchos. Whatever day of the week you visit, you'll find the same great crafts on sale here, and the same beautiful people selling them. I find that the Saturday market is a bit overwhelming -- I prefer coming on a weekday, when I don't have to visit millions of stands to be sure that I have found the most perfect bag or hat.

Shoppers should expect to do some bargaining, but I've found that prices will only drop a dollar or two (or 10% at most). Don't worry -- the asking price is usually quite low, and everything here is already a bargain.

Cuicocha Lake -- Cuicocha is a sparkling blue crater lake, formed about 3,000 years ago when the crater of the volcano collapsed onto itself during an eruption. The crater was covered with snow and when the snow melted, this lake was born. When the Incas came here, they thought that the island in the middle looked like a cuy (guinea pig), hence the name Cuicocha (guinea pig lake). You can take a motorized boat ride out to the island in the middle of the lake -- you'll see totora (the reed used in this area for making baskets and floor coverings), ducks, and a primary forest. The ride costs $2 per person. Be sure to bring a warm sweater, because the wind here can be vicious.

Cuicocha Lake also happens to be situated in one of the most dramatic settings in Ecuador. A trail loops around the crater -- it takes about 4 hours to circle the whole thing. But even if you walk along it for only 5 minutes, you'll be able to see Otavalo, Cotacachi, Cayambe, and all the volcanoes of Imbabura Province.

There is no public transportation available from Otavalo to Cuicocha; it's best to hire a taxi in Otavalo. A round-trip ride costs about $12, and the journey takes about 30 minutes each way.

Cotacachi -- Cotacachi is a sleepy little pueblo with incredible vistas. From here, you can see the snow-covered Cayambe and the lush green mountains in the distance. But no one comes here for the views (because Cuicocha, about 10 min. up the road, offers the best views in all of Imbabura Province). Cotacachi is famous for its leather stores that line Avenida 10 de Agosto. The quality varies widely, but if you search hard enough, you are bound to find some great bargains. Cotacachi is about 15 minutes from Otavalo; you can easily take a public bus from the station in Otavalo, or hire a taxi for about $5 each way.