Two scenarios I can see happening:
One, let Watkins walk and sign Jimmy Graham (and a mid tier FA WR). With the money we would pay Watkins, we could sign Graham AND a guy like John Brown. Even if we didn't add Brown, the addition of Graham would mean a TON more two TE sets, which effectively swaps out Watkins for Graham, and Woods showed that he is a deep threat. This would allow us to draft a WR in the mid rounds for depth and roll with Woods/Kupp/Reynolds/rookie/Thomas
Two, sign Trumaine Johnson to a long term deal, with the first two years containing most of the money. We could give him a 5 year deal frontloaded and by the time Peters needs consideration, Trumaine's cap hit is significantly less.
In the second scenario, we re-sign Joyner and Trumaine both. This still leaves us with about $25 million for free agents to address: NT, WR, C.
OLB will have to be the draft. We add more space by cutting Barron, and that money would be used for his replacement.
Having said all that, I would rather re-sign Watkins.