In this sign you can find the old Coat of Arms of Castro Verde, represented in an hand-painted tile work. The main motive of this Coat of Arms is the miracle of the Battle of Ourique.
«The Battle of Ourique, where Afonso Henriques triumphed over five Moorish Kings occurred in São Pedro das Cabeças, approximately five kilometres from the village of Castro Verde, and paved the way for the creation of the Kingdom of Portugal (in the Treaty of Zamora in 1143). As the legend of the Battle describes, the battle lasted two days (between 24–25 July 1139) and was so excessively bloody that the waters of Ribeira de Cobres flowed the color of red. Afonso Henriques who was declared Prince of Portugal, after the Battle of São Mamede, defeated the Moorish kings (at the Battle of Ourique), and was then proclaimed King upon the victory.»
«The story goes that on the eve of battle, after a day of exhaustive preparations for war, Afonso Henriques sought rest in the quiet of his tent when he was visited by an old man that, in the name of Jesus, instructed him to move away from the camp, alone.
Afonso Henriques did so and, in an isolated place, appeared to him a lightning illuminating a remarkable cross and Christ surrounded by angels.
Jesus said to him that he would win the battle the next day and would be crowned king.
After the long and terrible battle, what left the army of the five Moorish kings dispersed by the Alentejo plain, thus realizing what was, from that moment, considered a divine miracle, and forever, part of the popular image of Castro Verde.
Afonso Henriques as king of Portugal and took his shield the five escutcheons (known in Portuguese as quinas), representing the five kingdoms defeated.
This five escutcheons are also represented in the sign, as well as the seven Castles, that supposedly represent the Moorish castles conquered by the Kingdom of Portugal during the Reconquista.»
-- Source 1 and Source 2