quatschen
to chat
Colloquial for to have a relaxed and extended conversation; to chat.
Wir haben gestern Abend stundenlang am Telefon gequatscht.
We chatted on the phone for hours last night.

to chat / talk nonsense
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to chat
Colloquial for to have a relaxed and extended conversation; to chat.
Wir haben gestern Abend stundenlang am Telefon gequatscht.
We chatted on the phone for hours last night.

The verb 'quatschen' (to chat/talk nonsense) clearly belongs to colloquial language. It is used in everyday, informal conversations and should be avoided in formal contexts such as official emails or academic texts.
Lass uns später mal in Ruhe quatschen.
Let's have a proper chat later.
When 'quatschen' (to chat) is used in the sense of 'plaudern' (to chat), it often takes the preposition 'mit' (with + dative) for the conversation partner and 'über' (about + accusative) for the topic.
Sie hat am Telefon lange mit ihrer Mutter über den Urlaub gequatscht.
She chatted with her mother on the phone for a long time about the vacation.
The negative meaning 'Unsinn reden' (to talk nonsense) can often be recognized by the presence of a disparaging object such as 'Unsinn' (nonsense), 'Mist' (crap), or 'dummes Zeug' (stupid stuff). Sometimes it is also phrased as a command.
Er quatscht nur Blödsinn, wenn er aufgeregt ist.
He only talks nonsense when he's nervous.
to talk
'reden' and 'quatschen' can both mean that people talk to each other. 'reden' is neutral and fits in almost any context. 'quatschen' is colloquial and sounds casual, often like a longer conversation without an important goal. It is used mainly with friends or family. In a second meaning, 'quatschen' can also sound disparaging and mean that someone is talking nonsense. In formal situations, 'reden' is safer and more natural.

In der Pause quatscht mein Vater gern mit den Nachbarn.
During the break, my father likes to chat with the neighbors.
Wir reden morgen mit den Eltern über den Plan für den nächsten Tag.
Tomorrow we will talk with the parents about the plan for the next day.