Upgraded Shield and Boomerang (Waterfall of Wishing)
After you acquire the Power Glove you'll be able to access the northeastern portion of the map which has Zora's Waterfall and the Waterfall of Wishing (also known as the Mysterious Pond). To reach this location you'll want to head northeast from Link's house towards the Magic Shop. If you have the Flute you can fast travel to the Magic Shop.
Before you move a muscle if you don't have Zora's Flippers OR 500 Rupees get one of those two things first. I can guide you to get the Flippers really fast if you don't have them but they'll require 500 Rupees to get. Once you do have either of those two things, you may continue...
On the eastern side of the Magic Shop you'll find a large boulder that you can now lift since you have the Power Gloves.
Lift the boulder and follow the linear path - smashing the stacked rocks with your Pegasus Boots until you come across an area with a lot of water and a waterfall. For those that have never been here before, this is the Waterfall of Wishing. I am swimming just outside the entrance to the Waterfall in the picture below.
In order to reach the Waterfall in front of me and swim in deeper waters you'll first need the Zora's Flippers. If you don't already have them - don't worry I didn't just waste your time for nothing! The Flippers you pick up right around the corner! Click on one of the multiple Zora's Flippers links to read that guide on how to get them.
Inside the Well of Wishing you'll be given an option to toss different pieces of your equipment inside of the pool of water. You can toss virtually anything in and a fairy will pop out and hand the item back to you. Some items though she'll ask if you're the one who tossed them in or not.
Reply yes to her when she asks and instead of giving you the exact item you tossed into the well back to you she'll hand you an upgraded version of it. You can throw in your Fighter's Shield which the fairy will replace with a Red Shield that can block Fireball attacks.
You can also throw in your Boomerang which the fairy will replace with the Magical Boomerang that goes faster and further than your previous one. Finally you're able to throw in a Magic Bottle which the fairy will automatically fill with a Green Potion for you.
Additional Note: Even though the Fairy in Lake Hylia tells you to come here to raise your Bomb/Arrow capacity further - you can't. This Fairy never allows you to increase your capacity any further than the one on Lake Hylia did.