The answer is A: gazed at. The verb phrase <em>gaze at </em>replaces the verb <em>watched</em> in the sentence very well because Kimo was watching the waves in hopes of seeing something special. And gazing at means that someone is looking at something for a long time, in admiration and surprise, anticipating, expecting that something will happen.
To blink at - to ignore (something unpleasant)
To glare at - to look with anger
To look at - to direct your eyes toward someone/something.