Coupling reaction is type of electrophilic substitution reaction. In this reaction diazonium cation reacts with positive charge present on nitrogen. This nitrogen acts as electrophile whereas 2-napthol act as nuceleophile.
The OH group of 2-napthol increases the density at ortho and para position by resonance but para position of 2-napthol is sterically hindered and thus the diazonium cation attacks only at ortho position of 2-napthol.
