Just ran into this issue installing Watcher and want to get this out there to help someone else who might be having the same problem. The situation looks like a successful Watcher install -- ie
GET /_watcher returns something like
but the following exception is returned when attempting to create a watch
What I found was the elasticsearch.yml file contained the setting
If this setting is false when Watcher is installed the .watches index doesn't seem to get created successfully. The workaround used to resolve the problem was uninstall Watcher, change this setting to true (or just remove it), restart ES, then repeat the steps for installing Watcher. Hope this helps someone else.