fuzzy yarn?

I just knitted a shawl using the heather versions of Lion Brand Wool-Ease worsted weight yarn. I wore it a couple of times and then washed it according to manufacturer's instructions. Now it is fuzzy :( I have been picking off little balls of fuzz (yes fuzz, not pilling,) but it still does not look right. What did I do wrong and is there anything i can do to fix it?

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knitting

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