The watch's altimeter measures altitude at your current location based on changes in barometric pressure measured by the pressure sensor. (Relative Altitude Measurement)
After setting the known altitude at some location, you can determine the relative altitude at your current location.
If during a mountain trek you come across an indicator showing you are at 400 meters above sea level, for example, you can set your current altitude as 400 meters and then determine current altitudes relative to 400 meters as you continue to climb.
Changes in weather can affect barometric pressure. While performing altitude measurements when mountain climbing, it is recommended that you regularly correct the watch's altitude in accordance with the local altitude (elevation) indications.