The over-segmentation of the Watershed algorithm may be resolved by using the 'imhmin' function prior to using the 'watershed' function, as this would remove shallow minima from the image.
Please refer to the following link for more information on the 'imhmin' and 'watershed' function:
As an alternative, you may also use the 'imextendedmin' function prior to using the 'watershed' function, as demonstrated in the article below:
