Assuming you didn't change the 'tag' of your GUIDE-created figure (I always change min), you can just do
dcm = datacursormode( handles.figure1 );
dcm.UpdateFcn = @updateDataCursor;
and then define updateDataCursor in the file as
function outputText = updateDataCursor(~,event_obj)
where event_obj has fields 'Target' and 'Position' which you can use to create outputText, for example one I did uses the following:
pos = get( eventObj, 'Position' );
outputTxt = { ['R: ', num2str( round( pos( 1 ), 3 ) )],...
['G: ', num2str( round( pos( 2 ), 3 ) )],...
['B: ', num2str( round( pos( 3 ), 3 ) )] };
