Q: Unable to Auto Unlock MacBook with Apple Watch

Before I get directed back to the Apple Support Article - https://support.apple.com/en-us/HT206995, I have done so and followed the instructions without avail.

DEVICES / SYSTEM

iPhone 6 (iOS 10), MacBook (Early 2015, with macOS Sierra) and Apple Watch (2015, watchOS 3) all updated with same iCloud account with two-authentication factor enabled (checked with Manage Your AppleID).

Depicted below are the instructions, step-by-step I have attempted to follow from the article, with the resulting non-action at the last step:

1. Selected "Allow your Apple Watch to unlock you Mac" and receive the pop-up message

2. Receive message on iPhone

3. Selected "Follow-Ups" in Settings

4. Selected "Continue"

5. Directed to iCloud setting and to enter password. After entering password, the account accepted it and nothing else happened. Just back to the normal iCloud section on the iPhone.

I completed the "Sign in with your Apple ID on your iPhone in Settings to finish setting up two-factor authentication and allow your Apple Watch to unlock your Mac."

Two-factor authentication has already been enabled on all devices and yet I am unable to auto unlock my MacBook with my Apple Watch!

Very frustrating!!