The compass is displayed just below your avatar at the upper-left corner of your scanner‘s screen. It shows you which direction is north on the scanner display.
You can use two fingers to rotate the scanner display, and the compass will rotate accordingly. Tapping the compass (or toggling the “Compass” setting under the “Device” tab on the ops screen) switches between the static and dynamic compass. When the dynamic compass is active, the scanner will use your device’s magnetometer to orient the view dynamically as you rotate. Unfortunately, this doesn’t always work very well; many devices fail to orient the view to line up with the direction you are facing.
You can attempt to calibrate the magnetometer by standing as far away as you can from sources of electromagnetic interference (televisions, computers, power lines, cars, etc.) and moving the device in a figure-eight pattern in front of you while rotating the device in your hand. This might improve the dynamic compass behavior, or it might not.