First spotted my Macworld then confirmed by MacRumors, Apple has been testing Touch ID for Apple Watch.
According to MacRumors: "The code mentions support for "AppleMesa," which is Apple's codename for Touch ID suggesting that prototype models currently offer the feature in some way."
If this is true that means that this will be The FIrst apple watch to support touch ID. Now how they're going to do it is complicated and simple at the same time.
Apple will most likely put the Touch ID Sensor on the side button.
This sounds cool and it is, but like most things Apple it's just a rumor. Yes it's in official Apple code but that doesn't really mean anything.
Apple is most likely "testing" Touch ID.
Source: MacRumors