Both colors.
The pattern is over ... well, 29 stitches twice, so 58 stitches; the two outer stitches are both edge stitches. You slip the first one, and knit the last one with both colors, but you then treat the with-both-colors thing as a single stitch, and slip it. (If you didn't, you'd end up with a slightly odd-shaped dishcloth, since you'd be increasing one every row.

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