You say you are setting the watch to a predicted time. After setting it, you let the spectator hold the watch by the end of the strap, with the watch face turned away from them. You never touch the watch again.
You now ask the spectator to first call out ANY hour. Then you ask the person to call out ANY minute which together result in a time of day.
After doing so, the spectator slowly turns the watch around by himself. The face of the watch is set to their time!