If I use the makecode editor to create the code, it generates:
pins.touch_set_mode(TouchTarget.P0, TouchTargetMode.CAPACITIVE)
However, if I try and run this, it can't find 'pins'.
Note: I then investigated further and found out how to do this before submitting my question...
Capacitive mode can be set for each pin, e.g.
from microbit import *
...
pin0.set_touch_mode(pin0.CAPACITIVE)
...
if pin0.is_touched():
...
The last line checks whether the pin is touched - usually in a loop.
Hope this saves other people some time...