I also use a normal pencil for tracing. It doesn't fade and even after some time I still can see the lines. I do take a very thin pencil. You have now those pink pencils of that special TM, but I can't recall the name of the brand. You have loads of quilting supplies of them. They also have those normal thin pencils. I normally don't baste two layers of fabric ofr muslin together. here in Holland that is expensive too, so I use some iron on stabilizer and that works well for me. I choose the more expensive type as that one is a lot softer and for embroidering it is easier to slide your needle through the fabric.