As with many applications, you may customize the controls on the touch bar with View > Customize Touch Bar. The following controls are available:
Opens the manpage for the command behind the cursor.
When selected, this opens a scrollable list of color presets. Choosing one changes the current terminal's colors to use the preset.
There are two function keys controls. The first, labeled Function Keys Popover, opens a scrollable list of function keys when pressed. It is compact but requires two taps to press a function key. The second, labeled Function Keys, shows a scrollable list of function keys at all times. It takes more space but is quicker to use.
If you install Shell Integration and Utilities, then you'll get a command it2setkeylabel that lets you configure what each function key's label says. You can configure each application you use (such as vim or emacs) to set the labels appropriately.
The Add Mark touch bar control saves the current location in history. You can navigate among marks with Cmd-Shift-Up and Cmd-Shift-Down. There are also touch bar controls to navigate marks.
Navigates to the next or previous mark. If you have Shell Integration installed, each command prompt inserts a mark, so the previous mark is usually the previous shell prompt.
If you have Shell Integration installed, iTerm2 can remember you command history. That history is used to make suggestions for commands, which appear in this touch bar control.
The status touch bar control shows a user-configurable message. If you install Shell Integration and Utilities, then you'll get a command it2setkeylabel that lets you configure what the status control says. For example, it could display the git branch of the current directory. Tapping it scrolls to the location where the status was last changed.
You can define custom touch bar buttons in Prefs > Keys > Add Touch Bar Item. You can then add the item to you touch bar from View > Customize Touch Bar.