The 19-year-old is set to be a free agent in a few months’ time, and has failed to make a serious impact at Anfield since becoming the club’s youngest ever first-team player – he made his debut in 2012 at the age of 16.
Sinclair was largely frozen out of the senior set-up under Brendan Rodgers at the start of the season as his contract situation rumbled on, but Jurgen Klopp has handed the player two appearances – both against Exeter in the FA Cup third round – with the starlet repaying his faith with a goal.
However, reports claim that Watford have moved to seal a deal for the teenager, who will link up with Quique Sanchez Flores’ Hornets squad this summer.
Liverpool will be due a compensation figure for the forward, which will be decided by a tribunal unless the two clubs can settle a fee.
The Merseysiders valued him at £3m in January.