It doesn't really matter, unless the wires interfere with anything else in the area. You can pretty much choose the placement, give or take. The wires in the cap are at the sensor location. If you want the wires in a certain spot, then insert the shaft/gear and note the gap in the ring. Re-set the shaft to get it in a different spot, you may need to move the oil pump shaft with a large screwdriver. You want the gap in the ballpark of where you want the wires. After you get everything wired up, you'll have to set the sensor, but at least you're already close.