In volume 13 we find out that Watanuki can't remeraber anything about his past, not even his parents' names and faces. And then Syaoran tells Watanuki that they are closer than anyone else. And from there it gets even weirder, because we find out that Watanuki actually IS Syaoran. Syaoran couldn't find a way to save her the first time around, so he wished for a second chance to try to save her. His price was 'time' and 'freedom', and Watanuki was created to fill up that 'time' and 'freedom' Syaoran lost in his home world. Oh, but that's not the end of it. Because Watanuki is not technically supposed to exist, he will bring misfortune to everyone who comes in contact with him. The whole point of Holic is to keep Fei Wong Reed from finding Watanuki and using him for his evil plots.
Oh and Watunuki's dead parents? That's Shaoran and Sakura from Cardcaptor Sakura. That's right, they are honest-to-god dead. And Watanuki is the reason for that. Because he was in love with his mom. And went back in time to see her again. And that's why they're dead