Cloak & Dagger (1984) on Netflix

Davey Osborne (Henry Thomas) is an 11-year-old who lives in San Antonio with his father, Hal Osborne (Dabney Coleman). His mother has recently died, leaving just him and his father, a military air traffic controller who has problems relating to his child. Davey is a lonely child and is still grieving over his mother, so he immerses himself in the fantasy world of Cloak & Dagger, an espionage game which exists in both role playing and video forms. Davey has one friend, Kim, (Christina Nigra) a girl who lives nearby with her single mother. Davey is interested in the world of espionage and his hero is the character Jack Flack from the game. He wants to live an action-packed life like Jack Flack and he carries around a water pistol as his "gun" and a softball as his "grenade". Davey spends much of his free time playing Cloak & Dagger and spinning elaborate fantasies involving Jack Flack, an imaginary friend who takes the form of a more dashing version of his father (the role of Flack is also played by Coleman).