The nodal point is a point inside the lens where light paths cross before being focused onto a film plane within the camera.  The nodal point is important for many reasons. It’s responsible for making sure that the first photo taken will line up with the last photo shot during your 360º pan. If the camera was not setup at its nodal point than we would most likely be introduced to an optical distortion, called parallax distortion.  One way to experience parallax is to hold out your hand, and with one eye closed, place your finger over an object you see in the distance. When you close one eye and open the other, your finger apparently "jumps" relative to the distant object. This is parallax due to your point of view shifting a few inches, from one eye to the other.   When our software tries to stitch two shots together that weren’t taken with the nodal point set, it will cause a blurring or ghosting affect along the edges of objects near the camera - thus parallax distortion is apparent.

Parallax is more of a problem when there are objects within a few feet of your camera. For example, you will be faced with having to photograph near objects within a small room.  That’s why it is very important that you should try to get your pan head's line of rotation as close to the nodal point as possible. Achieving this is only possible with a pano head for your tripod.