A scale measures the total mass of everything present. Because most of what changes from day to day is water, the number moves for reasons unrelated to the tissue people are tracking.
Water dominates short-term variation
The body is mostly water, and the amount held shifts with salt intake, carbohydrate stores, hydration, hormonal cycle and recent exercise.
Stored carbohydrate is held with several times its own weight in water, so depleting or replenishing it moves scale weight substantially within a day.
Fat mass cannot change at anything like that rate, which means large day-to-day swings are almost entirely fluid movement.
Averaging separates signal from noise
Because fluctuation is large relative to the underlying trend, a single reading carries little information about direction.
Weighing frequently and comparing weekly averages rather than individual days filters most of the variation while preserving the trend.
This inverts common advice to weigh rarely, since infrequent measurement means each reading carries its full fluctuation with no way to identify it.
Impedance scales estimate rather than measure
Scales reporting body fat pass a small current between the feet and measure resistance, since lean tissue conducts better than fat.
The device measures resistance and then applies an equation using height, age and sex to estimate composition, so the output is a prediction rather than a measurement.
Hydration status alters conductivity directly, meaning the same body measured before and after a drink returns different results.
Reference methods have their own assumptions
More elaborate approaches use imaging, displacement of air or water, or skinfold measurement, and each carries assumptions about tissue density or distribution.
They disagree with each other by meaningful margins, which is why composition figures are not comparable across methods even when each is applied correctly.
Consistency of method and conditions matters more than which method is chosen, for the same reason it does with wearable estimates.
What the trend is actually for
Scale weight is useful for detecting sustained direction over weeks, and it is poor at attributing that direction to fat or muscle.
Combining it with a tape measure and with strength progression gives a better account, since those change in different directions when muscle is gained and fat lost simultaneously.
Rapid unexplained weight change, in either direction, is a reason to see a doctor rather than to adjust a routine.