Need to put it in a position so it will clear the rear diff. For me with a larger D60, it was at this position.
When you tighten U-bolts against axle, they will stay in place.
My sway bar may have been off a 3/4 ton truck, I forget at this point.
But the advice above still applies.

 

This it how I placed it, I have about 1 1/2" clearance to aksel. I could drop i more down but that will give me less ground clerance.

 

This is where mine was on my 78 before I removed it. It's a factory suspension, so no lift or anything like that.

 

Thanks for pictures
I see yours have been rotatet up until the u-bolt bracket toches the bracket on the leaf spring. If I do the same, that will rise my sway bar up about 1/2"