Al-jawab billahi at-taufeeq (the answer with Allah's guidance)
It is narrated that when Rasulullah (Sallallahu Alaihi Wasallam) used to sit down to supplicate, (to recite Tashahhud) he used to place his right hand on his right thigh and his left hand on his left thigh. He would indicate at the time of reciting the Shahadah by raising his index finger. He would also join the ends of his thumb and middle finger (thereby forming a circle).
[Sahih Muslim, chapter on the description of sitting-Hadith no.579]
On reaching the Shahadah (La Ilaha) form a circle with the thumb and middle finger and lift the index finger of the right hand and at (Illallahu) drop it onto the thigh. The circle should be maintained to the end. ( Ma'arifus Sunan Vol. 3 Pg. 105, Darse Tirmidhi Vol. 2 Pg. 63)
