On the back of your upper arm.
The sensor should be applied to the back of your upper arm. Either arm is fine and you may like to alternate when you change sensors.
Avoid areas with scars, moles, stretch marks or lumps. Select an area of skin that generally stays flat during your normal daily activities (so no bending or folding places like elbows).
For more advice on where to put your sensor take a look at the tutorial at start.limborevolution.com.