How do I unpair my watch from my lost phone

See the lost-phone section here: Unpair and erase your Apple Watch - Apple Support

To unpair and erase watch and remove Activation Lock.

On a computer, go to iCloud.com and sign in with your Apple ID.

Go to Find Iphone.

Select All Devices, then click your Apple Watch.

Click Erase Apple Watch.

Select Next until the device is erased.

Click the remove button next to your Apple Watch.