Amazon CloudWatch alarm is an AWS service or feature that can initiate an Amazon EC2 Auto Scaling action based on CPU utilization. Amazon CloudWatch is a monitoring and observability service that collects and tracks metrics, logs, events, and alarms for your AWS resources and applications. Amazon CloudWatch alarms are actions that you can configure to send notifications or automatically make changes to the resources you are monitoring based on rules that you define67.

Amazon EC2 Auto Scaling is a service that helps you maintain application availability and allows you to automatically add or remove EC2 instances according to definable conditions. You can create dynamic scaling policies that track a specific CloudWatch metric, such as CPU utilization, and define what action to take when the associated CloudWatch alarm is in ALARM. When the policy is in effect, Amazon EC2 Auto Scaling adjusts the group’s desired capacity up or down when the threshold of an alarm is breached89. References: 6: Cloud Monitoring - Amazon CloudWatch - AWS, 7: Amazon CloudWatch Documentation, 8: Dynamic scaling for Amazon EC2 Auto Scaling, 9: Amazon EC2 Auto Scaling Documentation