Yellow supplies power to the horn switch. When the horn button is pressed, it energizes the blue/yellow wire. Blue/yellow goes to both horn 1 and 2 - notice that one horn has two wires going to it. One goes to the switch, the other connects to the second horn. Each horn is a different pitch, which is how you get the high/low tone.
I have a migraine tonight and staring at wiring diagrams doesn't help. Let's discuss tomorrow.