The distributor rotor should point to the number 1 cylinder wire on the cap when the number 1 piston is at Top Dead Center (TDC) on the compression stroke. You'll need to use a timing light and a compression tester or a degree wheel to accurately find TDC on the #1 cylinder to properly set the initial timing. There's no easy way to "eyeball" this. A shop manual is highly recommended for this procedure.
