Seem like you cannot load jQuery properly:
<script type="text/javascript" src="jquery-1.2.6.min.js"></script>
result in this error:
Failed to load resource: the server responded with a status of 404 (Not Found)
as well as:
Uncaught ReferenceError: $ is not defined
So correct your path or better using CDN with later version since 1.2.6
is too outdated already:
<script src="http://ajax.googleapis.com/ajax/libs/jquery/1.11.0/jquery.min.js"></script>
You also need to wrap your jQuery code inside DOM ready handler:
<script src="http://ajax.googleapis.com/ajax/libs/jquery/1.11.0/jquery.min.js"></script>
<script>
$(function() {
$("#slideshow > div:gt(0)").hide();
setInterval(function() {
$('#slideshow > div:first')
.fadeOut(1000)
.next()
.fadeIn(1000)
.end()
.appendTo('#slideshow');
}, 3000);
});
</script>