VCC sets the HIGH

SIGNAL is an output, from VCC

Some input blocks give your pin a switch and a resistor. This one gives it a chip's output pin. The TTP223 drives SIGNAL both ways: to VCC when the pad is touched, to GND when it is not. That is called a push-pull output, and it means the HIGH your pin receives is whatever the chip runs on.

So VCC is not only the block's supply. It is the voltage your pin sees on every touch.

The bar sits a little under VCC. The chip's output is also lighting the LED, about 1 mA on 3.3 V, and a small output transistor drops a little voltage carrying it. The figure works that out from the one output figure the datasheet gives, 4 mA at 2.4 V from a 3 V supply; it is an estimate, not a measurement.

3V3 beside a 3.3 V board

An ESP32, an ESP32-S3 and a Raspberry Pi Pico run their pins at 3.3 V, and none of them is built to take 5 V. Pick 5V in the figure with one of them selected: it reads HIGH, the touch works, and the pin is past its rating every time. That damage is slow and it does not announce itself.

Connect VCC to 3V3. The chip is rated for 2.0 to 5.5 V and behaves the same from it; the LED is a little dimmer.

5V beside an Uno

The Uno's pins run at 5 V, so its 5V pin is the right supply. 3V3 is the one case where the output's small drop matters: the Uno needs 3.0 V to be sure of HIGH, and SIGNAL reaches about 3.1 V. It should read HIGH, with nothing to spare. Use 5V.

VCC left off

With VCC unconnected the chip is not running and nothing drives SIGNAL. The pin usually reads LOW, though a line nothing drives can wander, and the LED stays dark whatever you do, which is the quickest way to tell this apart from a sketch problem.