Apparently, he folded the grave cloth over his head.
And stooping to look in, (the other disciple) saw the linen cloths lying there, but he did not go in. 6Then Simon Peter came, following him, and went into the tomb. He saw the linen cloths lying there, 7and the face cloth, which had been on Jesus’ head, not lying with the linen cloths but folded up in a place by itself.
I don’t attach any significance to this, though verse 8 says that John believed when he saw it, possibly because no grave robbers would have bothered with folding his head cloth! I just think its a beautiful picture of the peace and order of the resurrection in contrast to the ugliness of the cross. It also gives an authenticity to the story to see how John and the other disciples remembered such specific details about the resurrection so many years after the fact.