The zoom tool (keyboard F6) is used to increase or decrease the horizontal (time) resolution of the timeline frame. Alternatively press Ctrl+Cursor Left and Right. To zoom in, Click+Drag anywhere on the waveform pane. To zoom out, Alt+Click anywhere on the waveform pane. At some point waveform display switches from the gray shaded peak/rms view to sample level view.
Note that this tool does not influence vertical zoom. To increase or decrease vertical zoom, press Ctrl+Cursor Up and Down.