1. A method for identifying and processing patches indicative of touch events from a plurality of pixels having touch values captured during a scan of a touch sensor panel, comprising: eliminating pixels having touch values indicative of no touch events prior to performing a watershed algorithm; and performing the watershed algorithm on non-eliminated pixels to identify the patches, wherein the watershed algorithm traces paths of unlabeled pixels of increasing touch values until a pixel labeled with a patch number is found, at which time all pixels in the path are labeled with the same patch number as the labeled pixel, or a peak is found, at which time the peak is assigned a unique patch number and all pixels in the path are labeled with the unique patch number.