To make it simple, the Tagalog word "wag" is basically the shortened form of "huwag" which means "Do not or Don't" in English. And you're absolutely correct, it is negative in meaning. I think the Filipino sentence in your question can also be translated as : I told you not to eat much or I told you, don't eat too much.
Another example for 'wag:
• Wag kang sumuko = Don't give up.
• Wag kang umiyak = Don't cry.
• Wag kang umalis = Don't go.
Hope this helps.
