Great to finally see someone else using this awesome plugin instead of jCarusel! What you want to do is explained in this demo.
The code is more or less something like this:
$('#slideshow').before('<ul id="nav">').cycle({
fx: 'turnDown',
speed: 'fast',
timeout: 0,
pager: '#nav',
// callback fn that creates a thumbnail to use as pager anchor
pagerAnchorBuilder: function(idx, slide) {
return '<li><a href="#"><img src="' + slide.src + '" width="50" height="50" /></a></li>';
}
});
It uses the function pageAnchorBuilder
that runs once for every item in the cycle. Here you have access to the current slide and idx. You are not saying anything about your markup or how the thumbnails are made, but this should get you started.
Note: I have not changed the settings to match yours.