This position is good for carrying a newborn or smaller baby, as well as a nursing child. The baby's head can be on the ring side or the opposite side. Having your baby's head on the ring side keeps him more upright while having the baby's head opposite the rings lets him lie more horizontally. I generally have found that most babies prefer to have their heads opposite the rings. To hold your baby in this position, first pull up the inner wall of fabric so that it is flush against your body. This will create a "pocket" or "sack" for your baby. While holding the baby securely (and supporting his/her head if he/she can't support it alone yet), place him/her in the pouch. Pull on the sides of the tail to adjust the tightness of the inner and outer wall and the center of the tail to adjust the middle of the pocket. Re-adjust your baby's position and tightness of the sling if needed for your comfort as well as your baby's comfort. As always, make sure that there is enough fabric around the child to keep them securely inside the sling. You may find that it is easier to tighten the inner rail of the fabric before you put your baby in the sling and tighten the rest of it after positioning your baby.
Many mothers find it easier to nurse with the baby's head away from the ring side and feet sticking out near the rings. To nurse in the cradle position, loosen the sling a little and drop the inner wall of fabric down a little so that your breast can come over the fabric. Latch your baby onto your breast using proper technique. Make sure that your baby is in the same position you'd use for nursing without the sling. Their chest should be against your trunk and his back facing away from you. This may require turning his/her body slightly from the regular cradle hold. Once baby is latched on, keep supporting him/her with your non-tail side arm and pull on the tail to tighten the sling. You want the sling snug enough to keep your baby in the correct position. Once it is snug, slip your arm out. You may find it helpful to support your baby's head with your palm a little and do one last adjustment of the outer wall of the sling to bring his/her head up to your breast. You can nurse hands-free this way, or you can keep your palm on your baby's head if you feel more comfortable. You can swing the tail over your opposite shoulder for additional privacy if you like (however, please make sure that there is nothing heavy or sharp in the pockets first).
For a small baby or newborn, most of the baby's legs will be hidden by the sling. When you nurse a larger baby/child in the sling, however, most of his/her legs will be sticking out on the ring side. Adjust the pouch of fabric near the rings to cup his bottom. Spread the fabric out so that the edge of the fabric near the rings hits behind the knees or lower to support him/her well.