The Portuguese forward set up Raul Jimenez for the opening goal in the 41st minute, and clinched victory with a 77th-minute volley after Watford goalkeeper Ben Foster misjudged a deep cross. Andre Gray equalized against his hometown club early in the second half.
Wolves consolidated seventh place, four points clear of Watford and Everton with two games remaining. Seventh position would secure a Europa League qualifying spot, provided Watford loses to Manchester City in next month's FA Cup final.
Watford beat Wolves 3-2 in a gripping FA Cup semifinal 20 days ago.
More AP English soccer: https://apnews.com/PremierLeague and https://twitter.com/AP_Sports