Hello FranElla,
Welcome to Apple Support Communities!
We want to help you reset your new Apple Watch so you can set it up and pair it with your iPhone.
You'll want to take these exact steps to reset it:
"If you forgot the passcode to your Apple Watch, you'll need to reset the watch and set it up again.
How to reset your Apple Watch if you forgot your passcode
- Put your watch on its charger and keep it there until you complete these steps.
- Press and hold the side button until you see Power Off.
- Press and hold the Digital Crown until you see Erase all content and settings.
- Tap Reset, then tap Reset again to confirm.
- Wait for the process to finish, then set up your Apple Watch again. When asked, restore from a backup."
This Apple Support page has the full details: If you forgot your Apple Watch passcode - Apple Support
If you continue to have an issue with the button, the Apple Watch might need to be inspected or serviced.
We hope this helps to reset the Apple Watch so you can get the most from it.
Cheers!