1. Preheat the oven to 400°F (200°C).
2. Cut boneless skinless chicken breasts into bite-sized pieces.

3. Spread panko bread crumbs on a parchment paper-lined baking sheet and bake for several minutes until they turn golden brown. Remove the toasted bread crumbs from the oven, add paprika, salt, onion powder, garlic powder, and black pepper. Stir to combine the seasonings with the bread crumbs.

4. In a bowl, whisk together egg and water using a fork.

5. Dip each piece of chicken into the egg mixture, then coat chicken in the seasoned panko mixture.

6. Spray a large wire rack with avocado oil cooking spray, then place the breaded chicken nuggets on the rack, ensuring they are in a single layer. Set the rack inside the baking sheet pan.

7. Bake in the preheated oven for about 18 minutes, or until the internal temperature measured by a meat thermometer reaches 165°F (74°C).

8. Garnish the nuggets with finely chopped parsley and enjoy!