How do i make this curve smooth? [Blender 2.69]

smooth did not do it!
TEMPBALLOONADJ.blend (706.7 KB)
i have part of a balloon that is smooth
i got a plane and took a vert and did the e thing to slowly duplicate the shape.
looks fine - but is pointy.
ideas very welcome
their balloon says sphere in the list thing on the right.
do i need to take the verts from a sphere?
thanks all
i use 2.69