Although the Iron took the lead through Maryn Woolford, they were defeated after Danny Graham and Matthew Whichelow scored for the visitors.
"I'm hoping in the next couple of days to announce a singing. I'm 98 per cent sure he's there but until I see a signature I'm not going to announce anything. That'll be a loan until the end of the season," said Baraclough.
"There are other bids in there and I need to strengthen as soon as possible. Bids have gone in, it needs freshening up for sure doesn't it."
One of those approaches is for the Bristol Rovers forward Will Hoskins, while the rumour mill has suggested the young Chelsea left-back Ben Gordon could be the loan signing Baraclough expects to sign.
The rhythm of this match was disrupted by three floodlight failures, but the Iron only had themselves to blame.
Michael O'Connor missed a penalty, while both goals conceded could be attributed to individual errors.
Garry Thompson's header back into the area for the equaliser was inexplicable, while Cliff Byrne was left for dead in the winning goal.
"I'm still not really sure how we managed to lose it. I thought we played some good football, particularly early on, and were the better team," added Baraclough.
"Some of the wide play was excellent. I felt Woolford was the best player on the pitch, and we should have had more reward for his endeavour.
"Teams score too easily against us. It is things you can talk about until you're blue in the face but if they keep happening you have to do something about it. We could and should have had the game wrapped up. In the end we were punished for two poor goals which we gave away.
"When the floodlights failed for the second time and the game was in danger of being called off, I was certainly not wanting it to be finished.
"I thought we could go on and win the game. Perhaps that was being naive and in the end we could have done with the electrician to pull the fuse again."
Malky Mackay, the Watford manager, was pleased his side were not distracted by the two delays in play caused by the floodlights failing when fuses blew.
"I've never been involved in a game quite like this where the floodlights have failed twice. The referee told us on the final occasion that if the lights went out once more then he would abandon the game," he said.
"To win in circumstances like this requires a certain mentality from the players and I was delighted we showed that. "I was also pleased we showed the character to come back from behind at a time when Scunthorpe were putting us under pressure."