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Knitting Tips - How Do I Get the Wiggles Out of Yarn Unraveled from an Old Sweater?  
You need to wind your yarn into skeins. If you don't have a reel,  swift or niddy noddy, then wrap it around the bottom of a laundry basket, or around the backs of two straight chairs, placed back to back (or just use your hands, although my arms get tired when I do this). 

The next step is *very* important to keep the yarn from tangling. Take some contrasting yarn (so it's easy to see when you need to remove it later), and tie the skein in 3 or 4 places. Catch the ends of the yarn into one or two of these ties. Each place that you tie it, divide the strands in the skein in half and cross the contrasting yarn through the center, so it makes a figure-8. Tie loosely, not tightly. 

Now that your skein is under control, wash your yarn. It's not even necessary to use soap, if it's not dirty. Just soak it in lukewarm water for up to 30 minutes, then gently squeeze the water out (you don't want to be rough with a natural fiber, because it will felt). Also avoid running water directly onto any natural fibers. 

Roll skeins up in a towel to remove excess moisture. Now, hang them up. I just throw them over my shower curtain rod. If there are still squiggles in the yarn, give a little pull on the skein to straighten them out. If you are planning to knit this yarn (rather than weave with it) then you don't want to dry it all stretched out. Although sometimes you see people recommending that you weight or stretch your yarn, it really needs to have it's elasticity left in for knitting.

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