Hi, You do have the pill holder in correctly according to your drawing. An .058" pill is rather small for what the newer fuel pumps put out. I reccomend that You have the fuel system flowed or ask Dave Conn at J&D performance engines or Foxco what pill to run after You inform them of your fuel pump size and output, nozzle size, high sped by-pass, and low speed by-pass settings.

Danny Williams Jr.