The Denver Nuggets are confident they will re-sign Peyton Watson in restricted free agency, sources tell The Stein Line.

But the Nuggets will almost certainly have to trade at least one key member of their team to accommodate re-signing Watson. The Nuggets would prefer to trade either Cam Johnson or Christian Braun instead of Aaron Gordon or Jamal Murray, but it isn't clear whether they will be able to find a trade that both allows them to re-sign Watson while truly boosting the roster around Nikola Jokic as the former MVP waits to sign an extension.

The Nuggets prioritized an extension for Braun over Watson last offseason and it became clear during the season that Watson was the more critical piece. Braun signed a five-year, $125 million extension, but regressed last season.

Murray is entering Year 1 of his four-year, $207.8 million extension signed in 2024. Murray was both an All-Star and All-NBA selection for the first time in his career.

Gordon is also entering Year 1 of his three-year, $103.6 million extension and will be at almost 20 percent of the cap. Gordon has dealt with injury issues each of the past two seasons.