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The narrative on which this song reflects is found in Luke 2:11-20.
Stanza 2 speaks of nails and the cross. See the prediction in Luke 2:35, and the story in Matthew 27:35-50; Mark 15:16-41; Luke 23:33-46; and John 19:16-30.
Stanza 2 refers to the “Word made flesh”, a reference to John’s revelation in John 1:1-2 and 14.
Stanza 3 calls him the “King of Kings”, a reference to this exaltation predicted in Philippians 2:9-11, taught in I Timothy 6:3-16, and shown in Revelation 19:11-16
The narrative of Christ’s incarnation is told in this song: stanza 1 begins with a child sleeping on Mary’s lap, a child who is the Word made flesh. In stanza 2, this child is called to bear the cross and yet is proclaimed as the King of kings who brings salvation. Our World Belongs to God, paragraph 23 teaches that “God joined our humanity in Jesus Christ—the eternal Word made flesh. He is the long-awaited Messiah, one with us and one with God, fully human and fully divine, conceived by the Holy Spirit and born of the virgin Mary.”