Using .gitignore with *.pyc in subfolders

You should not need the **/:

 __pycache__/
 *.pyc

That should be enough.

See for instance gitignore.io/python.
Note the practice of adding a trailing / to ignore specifically a folder.

Use git check-ignore -v -- afile (that I mentioned in Sept. 2013, with Git 1.8.2+) to check which rule ignores a file.
If the folder was already tracked:

git rm --cached -r __pycache__/

André Duarte adds in the comments:

After adjusting gitignore, I had to do this for every file, so I call awk for help:

git status | grep pycache | awk '{print $3}' | xargs git reset HEAD