I've had this issue for more than a year now. Sometimes it works, most of the time it doesn't. I can't be the only one experiencing this? The status bar says "Running" but even after half an hour, nothing happens on the Watch. Installing to my iPhone works just fine but as soon as I target the Apple Watch, it gets stuck.
Open the Apple Watch app on iOS
Scroll down until you see your app name, tap it and disable Show App on Apple Watch
Go back to Xcode and try to run the app on your Apple Watch again, the app should work now and allow you to use the debugger too.
Oddly enough, disabling WiFi both on the iPhone and watch seems to fix this for me (at least at the moment).
for reference:
https://stackoverflow.com/a/61053243/2064473
Same problem. Whenever it is working, and I then have to disconnect my phone and come back the next day and reconnect it, it stops working.
Same issue. I just got a new Air to replace my ageing laptop and hoped the issues would be gone, but nope, exactly the same problems. Xcode randomly decides that my watch is not available for development. With some luck it starts working again, but then I usually get the running but not really running problem instead. This time it was magically fixed by restarting Xcode after which it finally installed the app and managed to start it. What can possibly be so different with our setups compared to the Apple developers? I can't imagine they would put up with this every day.
I found this to work quite reliably when it inevitably stops working.
It seems to have a better chance of working after this
Since this is still relevant today, I'm just bringing my grain of salt here. Unfortunately this may not work for everyone.
Using the Profile function (Product > Profile / or command + i / or long press on the play button > Profile) seems to hit Xcode with a stick. When Xcode is ready with that, no need to choose a profiling template, you can stop there and run you application. I have not found the need to restart any of the devices, it looks like it's enough to make it work. However when I'm doing that a few times in a row, I may need to restart Xcode.
Also in case it doesn't run automatically, you can go to your Apple Watch and open the app. It should be installed and/or updated.
One workaround I had the most luck with is to run the iOS target on the iPhone the watch is attached to, wait for it to install on the watch (check for progress in the Watch app) and then run it manually from the watch. There's no debugging this way though.
Same issue, nothing helps. 😔
Utterly frustrating and this still happening until today
Issue solved after disconnecting/reconnecting iPhone, waiting for Preparing both iPhone and Watch, and then enabling "Connect via network" on "Devices and Simulator / iPhone"