These are the traditional scrunchies, like the ones we had back in the 80s. Back then they were made them from very bright cotton fabrics. Now most of the scrunchies I encounter are made from lycra and sitting on the head or a gymnast or dancer, but if you want to get your 80s vibe going, these scrunchies could totally be made from bright printed cotton and wrapped around a high, permed ponytail.
This technique gives a nice neat finish to a scrunchie and can be made using either an overlocker or a zigzag stitch on your sewing machine.
To make your scrunchie:

• Cut a piece of fabric 7.5cm x 75cm (3 inches x 30 inches).
• Cut a piece of elastic 20cm (8 inches) long. The elastic should be 6mm (¼ inch) wide or less. 

Fold fabric in half, with wrong sides together along the dotted red line and pin along the raw edge.

Sew raw edges together along the dotted red line, leaving 3-5cm (1-2 inch) of fabric unstitched at either end.

Using a safety pin as a guide, turn the scrunchie the right way out.

Open out the unsewn ends of the scrunchie and pin together

Sew the ends of the scrunchie together to form a loop.

Using a safety pin as a guide insert elastic into your lycra. The fabric will gather as you pull the elastic through it.

Tie the ends of the elastic together

Push the elastic into the opening in the scrunchie.

Tuck the raw edges inside and pin the opening in the fabric closed.

You can either stitch the opening closed by hand for a super neat finish or topstitch with your sewing machine, close to the edge of the fabric.

Completed Scrunchie with invisible seams.