If you typed your app password correctly but it is not working, please try to clean the window credential to check if the issue persists:

 

  1. Type "Credential Manager” in the search box of computer > Click “Credential Manager”.
  2. Click “Windows Credentials” > “Generic Credentials”, you will most likely see the entries about the email account of the user.
  3. Delete them.
  4. Restart outlook, you should type your app password again and select the option to remember it.



Other option 

There is also this reg location that I’ve read needs accounts removing from sometimes (but not needed to do that myself yet):

 

HKCU\Software\Microsoft\Office\16.0\Common\Identity\Identities

 

16.0 refers to Office 2016… others may be relevant