1968 340 timing

.the #1 spark plug wire on the cap is at 3 o'clock and I think its should be at 6 o'clock.
Any tower can be #1... #1 is determined by the placement of the rotor..... at #1 TDC-compression; and not anything else.If it runs good then you're all set.
It is customary to have the rotor pointing to the driver's side front intake bolt ..... but not mandatory. It just helps in making custom plugwire kits fit.
If your strobe finds the timing line on the balancer, then you have the right wire; just label your cap accordingly.
Ignition timing for a performance engine is NOT set at idle.
You must defeat the vacuum-advance, then rev it to find the rpm past which the advance has peaked, and make sure your timing there is not more than ~36* . You might have to go to 4000rpm. Then you take her out for a power-test and if it detonates, you have to reduce your power-timing, say 3* and repeat, as often as necessary to get out of detonation.
Then
you check the idle-timing, and modify the parts as may be necessary to get the idle-timing up in the 12 to 16 degree range.
Don't forget to re-install the Vcan, and more testing to find detonation and eliminate it.

You lost me with this
When I use the timing light the reading on the blancher reads.
1
.8
0
right on the 5 degrees mark.
I cant see the one straight line on the balancer at all
The timing tab is calibrated
10 iiiii 0 iiiii 10
If you cannot find the line on the damper; you either are on the wrong wire, or your timing is waaaaaaaaaaay over advanced. Try retarding it
To check the power-timing, you will need either; a timing tape or a dial-back timing lite.