Final Cut Pro transitions not working between clips on the same timeline

I am guessing that you are talking about connected clips.

Try making these clips into a storyline.

Select both clips, and press Command-G. A grey "shelf" appears encompassing these clips, indicating that they are now made into a secondary storyline.

See if you have any problem adding the transition then.

The only time I see "Create Storyline" unavailable is when there are clips selected that are in the primary storyline.

If that is what you are trying, it makes sense that it does not work.

In that case, you could select the clip(s) in the primary, and do Edit->Lift from Storyline

(or press Command-Option-UpArrow). Then you'd be able to create storylines and apply transitions.

It will be much easier to understand what you are trying to do and why it does not work if you post some screenshots.

Q1: What is the name of the transition?

Q2: What color handle appears when you click on the connection between clips? Yellow? Red?

As Luis said, please show me screenshots and explain.