The spindle should be away from the Machine Home position somewhere in the machining zone of the table. It also needs to be free to rotate by hand.
The origin point for the machine coordinate system is called Machine Home. This is the position of the center-face of the machine spindle when the Z-axis is fully retracted and the table is moved to its limits near the back-left corner.
The tool may measure differently in the Home position than it will in the machining zone.