It isn't. :)
There was a free utility out there that would email you when
something new hit your pre-determined radius, but after
some programming changes on Geocaching.com a couple of months ago, it
no longer works.
I believe that new cache notification is a "coming-soon" feature
of premium membership, though when that may be implemented remains to
be seen
So
I've looked all over the website and can't figure out how you have the
site notify you immediately of new caches in your area. How is it done?