Ice Storm is also great. With all the Llanowar and BoP and Lands, your going to have too much mana in this deck. I built a similar deck and found that something simple like "Spore Frog" can be a game changer. Also instead of Doomgape, maybe try Creakwood Liege or Mycloth.
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I have a T2 merfolk and you would be amazed how nice a combo it is with Merfolk Skyscout.
Like the unstable footing. Id maybe sideboard in some Goblin Balloon Brigade in case you run up a against a flying deck. Also, I'm not sure where you would put them, but I still love the Goblin Arsonist.
Nice deck, but the creatures need some work. Maybe a few Hypnotic Specter instead of the Bombers. If you got enough discard working maybe Nyxathid. Or some Rotting Rats. Or, just stay simple with some Vampire Nighthawk for control and life gain. Like the deck though.
I also recommend Strongarm tactics and Small Pox. Both help with discard and are also a form of creature removal.
Merfolk Sovereign might be nice in this deck.
Glittering Wish or Living Wish !!!!! Pikachu Agro!
Tried something similar the other day, http://www.mtgvault.com/ViewDeck.aspx?DeckID=77912 Seems to work out quite well.
Propaganda. Force them to pay an upkeep for their creatures even though they can only untap 1 land per turn.
Needs a Sideboard... Im thinking some more rats.
Also maybe Sideboard a few Pendrell Mists. Depending on what your team is playing, could be huge. "Oh, you just got 7 0/1 plant creatures for free that come into play tapped? That's OK cause they are dead next turn."
Heart Sliver is far better than the Reflex Sliver. Same thing for 2 Less Mana.
Also maybe some Terminates.
Maybe a Vulshok Sorcerer instead of your Skitters. Other than that, I hate playing against these kinds of decks.
Original deck, i like it.
No Nissa Revane? Take out the Verdant Catacombs and just put in 4 more forests...And 22 Lands is a lot for an Elf deck.
I would add more card draw, or put the Howling Mines in. Maybe a few Thirst for Knowledge or something. With all the Zero mana cards, your going to be waiting for draws alot.
You may even want to add a few Dauntless Escort or even Eldrazi Monument to prevent from board wipes. Maybe replace the Jaddi Lifestrider with them, just my 2cents.