The CPUHighAlarm parameter will alert you when the average CPU utilization goes over the value set in the ThresholdCPUHigh parameter. CPU utilization and other instance metrics are tracked by CloudWatch. This alert will be sent to the ScaleUpPolicy resource that's provisioning more instances, which will bring the average CPU utilization down across the whole autoscaling group. As the name suggests, the CPULowAlarm parameter does the opposite when the average CPU utilization goes under the ThresholdCPULow parameter.

This means that new instances will be launched until the CPU utilization across the autoscaling group stabilizes somewhere between 40-60% (based on the default parameter values) or the MaxSize of instances is reached.