I used two colors of Soft Delight to emulated some stripes, and held each strand with the denim (2 strands of yarn throughout the piece). It is a very loose piece,looks like a giant sock cap right now, but once I felt this bag it will be about a 9" by 11". It is around 13" high and 11" wide right now.
I used the pattern to the right for a purse, cast on 28 instead of 26, knit and purl the base, then picked up all my stitches all the way around (the sl st at the beginning of each row makes it easier to pick up and knit the smaller ends of the base. Then simply knit on a circular needle as high as you want to make the bag a little taller than it's width be sure to knit 1/3 taller than you want the final piece.
Knit an i-cord strap: