Pendlebury, the current outright favourite, has eased from $3.50 to $5 in betting after scans on Monday revealed a cracked tibia.
The Magpies midfielder is expected to be sidelined for two to three weeks.
Watson has come in from $9 to $7 with TAB Sportsbet, with the betting agency's Adam Hamilton saying the Essendon skipper has the chance to shorten further during Pendlebury's lay-off.
"We feel Jobe Watson would have been in the votes on Saturday night, despite them getting beaten," Hamilton said.
"Pendlebury is still clearly the favourite, because ahead of his injury we had him polling in six or seven of the nine games he'd played in, so the way our guys were looking at it, he had a pretty good lead.
"But if Jobe can pick up some serious votes in Pendlebury's absence, then he could take over as favourite."
Watson had 32 disposals, booted two goals and laid five tackles in the Bombers' shock loss to Melbourne.
Gold Coast skipper Gary Ablett, whose odds drifted after he missed rounds five and six with a knee injury, has come back into contention following his 53-possession performance in Sunday's loss to Collingwood.
The former Cat's odds have been tightened from $13 to $8.
"Ablett missed those games early in the season, but Pendlebury's injury puts them back on a level playing field," Hamilton said.
Hamilton also reported interest for Richmond's Trent Cotchin, shortened from $15 to $11 after his strong performance against St Kilda on Friday night, and Adelaide duo Scott Thompson (now in to $17) and Rory Sloane (in to $51).
The Coleman Medal has become a two-horse race following bags to Tiger Jack Riewoldt and Hawthorn's Lance Franklin at the weekend.
The pair started the season as strong favourites for the goalkicking award, but had drifted in recent weeks.
Riewoldt was wound in from $4 to $2.50 favourite after his eight-goal effort against the Saints.
But he was quickly replaced at the top of betting when Franklin booted 13 against North Melbourne, taking his season tally to 34, three clear of Riewoldt.
The two-time Coleman Medal-winning Hawk shortened from $3.50 to $2.
"Before we started the season, Jack Riewoldt was the only one they wanted to back," Hamilton said.
"But then when he started quite scratchily, the punters zoomed in on Franklin.
"In the past few weeks we had people starting to look for left-field value selections, until last weekend's results when they've come back to the two favourites.
"But still Riewoldt is easily our worst result. He's been easily the best backed, but it was all pre-season money."
Tom Hawkins, who headed the goalkicking table leading into last weekend's matches and had been backed in from $101 to $7, has now drifted to $26 after news of his knee surgery.
Crow Taylor Walker is third-favourite for the award at $13.
The views in this article are those of the author and not necessarily those of the AFL or its clubs.
