The Mohr Circle is a tremendously useful way to plot stress and strain. Unfortunately, to derive it, we have to plow through a bit of trigonometry first.
Compression is positive, tension is negative.
The stresses can be defined in terms of two perpendicular longitudinal stresses. We call this a principal axis system . For any stress system, we can always find a principal axis coordinate system. To simplify conversions between stress and force, we assume the plane has unit area. By the way, we define compression to be positive and tension as negative.