Describes what you saw or heard, expressed in neutral language without an interpretation or evaluation of what happened.  An observation is just the facts.

A judgment is an interpretation of what happened, the meaning or story our mind creates about what happened.  

Observation:  She looked at her watch over a dozen times in our 20-minute meeting about my project.

Interpretation:  She doesn’t value my project, or my work.

Concluding that the watch-checking woman doesn’t value the project or work is not a fact; it’s an interpretation.  Checking her watch might mean she was distracted, or perhaps she wanted to cover several topics with you and was worried the time was too short!