Knitting on circular needles - purse

I am trying to knit a felted purse - this is the first one I’ve done. The pattern says to knit a rectangle on straight needles, then pick up on circular needles. So far, I have one long side and one short side of the stitches picked up and onto the circular needle. But, how do I continue with the other long side - the rectangle is getting stretched out. Does this make sense? Please help!!

I haven’t made a bag like this myself, but it seems to be a very common way of doing it. I believe if you just get all those stitches picked up and start knitting in the round, things will straighten out.

I’ve made abajillions eleventyples thousand hundred bags this way… it’s okay if the rectangle gets stretched, once you start knitting in the round it will go back to being rectangle shaped!