From Wayne Kawamoto,
Your Guide to Magic & Illusion.
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In The Color-Changing Handkerchiefs, the magician appears to make a handkerchief of one color change colors by simply pushing it through a hand. And at the end, the magician shows his or her hand is empty after the change. After that, the magician pushes the handkerchief through the hand again, which turns the handkerchief into yet another color. At the end, the magician shows that his or her hand is empty.

Here’s how it looks:

The magician continuously runs a handkerchief through a hand to show that it is empty.