If all settings normal but behaviour is irrational there is a progressive hierarchy of remedies...
First force restart the Watch
i.e. press and hold both the side button and Digital Crown for at least 10 seconds, then release both buttons when you see the Apple logo.
Then, while it is restarting, Force Restart the paired iphone Force restart iPhone – Apple Support (UK)
Test it for a while. If it is still misbehaving... Unpair and set up again
Unpair and erase your Apple Watch – Apple Support (UK)
and then set up without restoring the backup
Set up your Apple Watch – Apple Support (UK)
You may also want to make sure the software on the watch and iphone are both up to date to the same level. Updates are in pairs. ios16.3.1 and OS9.3.1, (or ios15.7.3 and OS8.7.1)
Update your iPhone or iPad - Apple Support
Update your Apple Watch - Apple Support
- By this point it is worth pairing to another iphone 8 or later if you have one to see which device may have a bluetooth wireless problem
If you've completed that troubleshooting and the issue is still not resolved, Contact Support.
Click here > Contact - Official Apple Support
or phone numbers
Click here > Contact Apple for support and service - Apple Support
and or Genius Bar Reservation and Apple Support Options - Apple