The lake has limited room. If more water flows into it, it spills over. That is why one must set limits for it. In the image there are the waters below and the waters above, and between them, as a limit, is the firmament of heaven.
In Chinese, the word for limitation properly means the firm joints that divide bamboo stalks into sections. In ordinary life it refers to thrift, which keeps fixed limits on its spending. In moral life it is the firm limits that the noble one sets for their own actions, the limits of faithfulness and selflessness.