Watch won't pair with watch app

Is the pairing asking for the password for an Apple ID you don't recognise?

If so then it is activation lockrd and will never be unlocked except by the previous owner.

If not then...

First check you have no other sports watches like Fitbit that are paired to your iPhone

Erase the watch like this

1. Put your watch on its charger and keep it there until you complete these steps.
2. Press and hold the side button until you see the power button in the upper-right corner of the display.
3. Press and hold the Digital Crown until you see Erase all content and settings.
4. Tap Reset, then tap Reset again to confirm.
5. Wait for the process to finish, then if necessary set up your Apple Watch again. When asked, restore from a backup.

Erasing all content and settings erases all media, data, and settings from your Apple Watch, but it does not remove Activation Lock if it has one.

Then Force Restart the paired iphone 

Force restart iPhone – Apple Support (UK)

Make sure you have no VPN or VPN based adblocker

Try again.

Then I recommend reviewing the steps in the articles below

How to pair an Apple Watch with your iPhone

 Click: How to pair your Apple Watch with a new iPhone - Apple Support or

Can’t pair an Apple Watch with your iPhone

Click:  If you can't pair an Apple Watch with your iPhone - Apple Support  or

Apple Watch not paired with your iPhone

Click:  If your Apple Watch isn't connected or paired with your iPhone - Apple Support