Hello HOC,
You do not seem to have raised an answer from anyone so even though my layout system is quite out of date to this computerised Modelleisenbahn era, I offer a humble reply.
Originally Posted by: HO Collector 
I know that Marklin has an isolation unit but I don't like the look of there catenary and the photos above and in the other thread (constructing a Sommerfeldt catenary) didn't make it clear. ......
Originally Posted by: HO Collector 
How do I create the insulated section in the catenary?
Sommmerfeldt has a realistic electrical separation unit (improved lately) that looks like the prototype, see here from their cattledog (https://www.sommerfeldt.de/images/download/sommerfeldt-katalog.pdf) :

Since my layout is primarily digital I do not utilise these but I used a similar earlier version on my 1980's analogue layout and all the other parts of my answer have the same principles be it analogue or digital.
Originally Posted by: HO Collector 
Yes, I understand that there is a need for 2 circuits. But how do I connect the signals to the catenary? After all the signals are a switch that open/close the circuit.
Actually , the signals are not the effective "switch" but are connected to a relay that controls both the power to the isolated section and also the light signal aspect, thus the light signal reflects, rather than controls the situation.
From your posted questions I gather you are running both digital and analogue and wish to control analogue locomotive power from the catenary reflected in parallel signal appearance. I presume this is a part of a "block" system in analogue. Given you are running both analogue by catenary and digital by "centre rail" you would also need independant digital power connections to an isolated section of track in front of the signal for the digital side but this is how to do it as far as the catenary analogue power side is concerned :
To achieve this simply you use an electrical relay switch: either the original old märklin solenoid relay imaged below, the newer solid state version (see the next following image) or a similar adapted relay from your local electronics store if you are electrically handy. In current times many people will do all this by computer (CS or PC unit) control in various ways.
You need to insulate/isolate a section of the catenary in front of the signal with two of the Sommerfeldt accessory shown above, or other isolating/insulating adaptation if in the area the caternary joins a mast or "Quertragwerk".
Power to that isolated section of catenary (left red wire in image next below) from your analogue locomotive power transformer (right red wire in image next below) is then controlled by the relay. The relay itself is powered by the "light" power - yellow wire on top edge of relay (best to use a separate transformer for all, some or one of illuminating lights, light signals, uncouplers, non-digital points, turn/transfer tables, scenery motors etc). The relay is moved to either pole under control of the two blue wires on top edge of relay:

The "newer" märklin "solid state" relay :

The same relay also controls power (from signals power source transformer thick green wire) to the signal (green ["Hp 1"] - the thin green wire) when isolated section is activated:

or red ["Hp 0"] (thin purple wire) when the relay is set to "power off") ; the same source can be used to determine the setting of the "distant signal" (doubled thin green wire and thin yellow wire) :

The relay is controlled by a detection source two blocks ahead (one of the blue wires top edge of relay) of the isolated section under discussion. In my "old-fashioned" layout the detection source is the old märklin contact switch :

but there are many other options in current times, including magnet sensitive reed switches, infrared, photo-optical, isolated outer rail contacts and more.
Thus the train entering the next block section triggers a track contact switch, this triggers the relay (the first of the blue wires top edge of relay) which "turns off" the power to the isolated catenary section and changes the signal to red, then further down the line the train on "clearing" the block section two ahead again triggers (by way of a contact or other switch) the relay (the second of the blue wires top edge of relay) , activates the power to the isolated section of catenary and changes the signal back to green.
If you want more detail or references to all this feel free to PM me.
Regards,
PJ