Here is a simple example of a 'Draft' watermark.
\setupcolors[state=start] \defineoverlay[WatermarkOverlay] [{\framed[frame=off,foregroundcolor=gray] {\scale[sx=12,sy=12] {\rotate[rotation=20.0]{Draft}}}}] \setupbackgrounds[page][background=WatermarkOverlay] \starttext \chapter{first} \dorecurse{30}{\input tufte } \stoptext