Warner is the second-highest run-scorer in IPL 2023 and has hit three half-centuries in four games, but has scored at a sluggish strike rate of 114.83 and is yet to hit a single six this season.
"The other night, Dave [Warner] definitely had a [much] more fearless mindset with the way he was batting," Watson said on the Grade Cricketer podcast. "He was taking the game on… yes, he missed a few balls that in the past he would have hit for four or six, he's mis-hit a couple of balls, but that's all part of Dave just working through the technical side of his game.
"That's also part of my role as well, as a coach. Because I know Dave so well from batting with him and playing with him, there's one or two little things that I know he'll get right over the next couple of days and I'll be blown away if he doesn't - yes, he's been scoring runs, but from a scoring perspective - if he doesn't set the IPL alight from now on, knowing that he's so close.
"He's batting very nicely. He's just mis-hitting some balls that he'd normally hit for four or six. Once you do that, once you start really finding the middle of your bat, then your scoring rate just goes through the roof."
He added that Warner had been "working through" a "challenging inner battle" in the first three games of the season, grappling with whether or not to take risks as wickets fell at the other end. "It goes against a lot of the things that you're taught as a kid growing up," Watson said. "You lose a wicket, you've got to establish a partnership - even in T20 cricket - for five or six balls.
"But then, if you do that and you keep losing wickets after five or six balls, before you know it, you're three overs down and you've just been rotating ones to try and build a partnership. Dave was just working through that himself in the first few games."
"It's never perfect when you lose your first four games," Watson said, "but that is the beauty of having someone with the skill of Ricky Ponting as a coach, and just his understanding of people. That's the beauty of being a coach, to be able to help the guys where they need it.
"These are the times when you really see the true colours of people and coaches, when things aren't going well. It's a true sign of character: how you can work through the little things that are not going how we want them to, to turn them around and be more consistent."