If you want up down counting, you need to mount TWO stationary sensors near the toothed wheel. They could be Magnetic or optical. The sensors need to be mounted so as to have their outputs 90degrees out of phase (i.e. overlapping). This is called "quadrature" (Google it). A quadrature decoder produces two outputs: Count and Direction.
If you want only unidirectional counting, then use only a single sensor.
Connect the sensor(s) to binary or decimal counter i.c. chips. If you want a roll-overs at zero and 35, you will have to add decoding logic at the counter outputs. If you want a display, use decimal counting, 4line to 7segment decoders and Led seven-seg displays for the readout.
