Where to capo for Ab major
Put the capo at fret 1 and play Ab major using G major shapes. That is the easiest of the eight positions ranked below, and it is what most players reach for. Against playing Ab major open, it drops the mean difficulty of the key's seven chords from 6.2 to 3.4 and gains 17 ringing open strings.
You want Ab. Capo 1 and play in G.
All eight positions, ranked
Each row transposes Ab major down by that many frets to find the shapes your hand would actually make, then scores the best voicing of all seven chords — fewer fingers, less stretch, closer to the nut, fewer muted strings. Lower is easier. Standard tuning (E2 A2 D3 G3 B3 E4).
What you are playing
The seven chords of Ab major are Ab, Bbm, Cm, Db, Eb, Fm, Gdim — the ones the ranking above is scored against. Their diagrams are on the Ab major key page.