Need help on first hat

[Rennagayle]

Okay, I finally got my circular needle set (Denise's) and am ready to attempt this hat.

I think I understand how to join in the round (hope), I know how to keep my stitches untwisted, but am unclear about the number 2:

Instead of turning work to continue, join the two sides to form a circle. When forming the circle be sure that 1) knitting is not twisted around the needle, and 2) that the rolled edge curls to the outside of the hat.

I'm not really sure how I'm supposed to know which is the outside