The 30-year-old right-back moved to the Vicente Calderon last summer from Malaga and was used as an option at left-back by Diego Simeone following the departure of Filipe Luis to Chelsea.
However, with the Brazilian defender returning to the Spanish capital this summer after an ill-fated solitary season in West London, Gamez was fallen down the pecking order.
The veteran was not in Simeone’s match-day squad for Atleti’s 1-0 win over Las Palmas on the opening day of the new La Liga season, leading to speculation over his future.
Marca claim that the versatile defender is available for transfer, with Watford and Fiorentina stealing a march on other European sides in the pursuit of his services.
The Vicarage Road outfit have been promoted to the Premier League and were ambitious in the transfer market over the summer, bringing a wealth of experienced players to the London club.
A positive opening to the new campaign has seen the Hornets unbeaten in their first three games, with consecutive draws against Everton, West Brom and Southampton so far.