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Start with the loom facing towards you and remove the middle part and last blue piece.
Like this
Do four little figure eights and stretch a band over all four pegs (will be shown in next step)
Stretch the figure eights over the top band and you should have this (repeat until you have it big enough. (If your doing a pattern make the top band your next color.)
Carefully take it off the loom and secure the remaining band. Then clasp it together and your done!
When your finished it should look like this