This message means, that server-side Atelier API -- web-application /api/atelier -- is configured with only Unauthenticated access. So, even though you put Username/Password in Server connection dialog, they are cannot be used, as server-side configuration does not allow this.
To allow password authentication, open Management Portal, then go to Menu (top-left corner) -> Manage Web Applications -> [api/atelier].
Put checkbox near Password in "Allowed Authentication Methods". Save the web application