How high should I keep the water level in the pool?

Pool water level is directly associated with the the point of suction that leads to the pump and equipment.

Most typically, the skimmer is the primary point of suction; so keeping the water level about midway above the base of the skimmer opening tends to be the easiest visual.

No matter the suction point, it is imperative to ensure that water flows freely and unobstructed into the opening in order to ensure that air is not introduced into the system.