I have seen luxury balls but I don't know what effect they have on pokemon!
Luxury Balls are Poke balls that, when they capture a Pokemon, will double the Happiness values for that Pokemon.
Obvously, this is useful for Baby Pokemon like Pichu and Cleffa, or Zubat, who eventually have to evolve with Happiness.
A luxury ball will make a Pokemon more friendly, so if you want to use a move like return, use a luxury ball.
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