The compass is displayed near the upper-right of the scanner screen and shows which way is north.
There are two compass modes: dynamic and static. The dynamic compass rotates the screen automatically as the device rotates in the real world. The static compass preserves the current map orientation regardless of the orientation of the device. Tap the compass arrow or change the corresponding option in the Settings menu to toggle between the static and dynamic compass. The arrow will have a white tip when the compass is in dynamic mode.
In either mode, you may manually rotate the screen by swiping on the screen with a single finger. If the compass is in dynamic mode, it will revert back to dynamic orientation after a few seconds.
Unfortunately, the dynamic compass 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.