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Yes.
Per Apple, you can still do many things even if your Watch isn't connected to your iPhone, cellular, or wifi.
I believeThanks to @grg's comment for pointing out that the Watch uses bluetoothNFC to make a connection to the payment terminal.
I believe the Watch uses bluetooth to make a connection to the payment terminal.
Thanks to @grg's comment for pointing out that the Watch uses NFC to make a connection to the payment terminal.
