Make sure that you have the most recent version of Continuum firmware installed. The Continuum's Kyma and MPE support has been undergoing active development in the recent firmware releases. Firmware 7.52 is the current version, available since March 2016. Also update the Continuum Editor at the same time.
You have to have Kyma's preferences with the setting "Continuum and MPE compatible" set to YES (see other answer from SSC for additional detail).
In the Continuum Editor set it to "Kyma Mode". This is available in the Velocity Menu. When set, and the communications between the Continuum and Kyma is working correctly, the values of the X, Y, and Z settings will turn blue to signify that those are now working in the special Kyma mode.
I recommend using the Kyma mode instead of the MPE mode for use with Kyma unless you have a specific reason to do otherwise. The Kyma mode has some additional feature that MPE does not offer, such as automatically setting the Continuum's polyphony setting to whatever the loaded Kyma sound requires.
If you are using KymaConnect then there is one other detail. You need to choose how to route Continuum MIDI to the Pacarana. You have two options (pick only one):
1. Let the Continuum Editor handle this for you.
2. Use one of KymaConnect's Ext. MIDI.
Most people use option 1; option 2 is useful in some situations, especially if you sometimes what or need to use the Continuum and Kyma without the Continuum Editor active.
I've done a blog post http://drk.delora.com/musings_blog/?post_id=614&title=what-is-the-best-way-to-connect-the-continuum-fingerboard-with-kymaconnect that discusses this in further detail.
The most important thing is just choose one method. If Continuum MIDI is routed by both the Continuum Editor and KymaConnect to the Paca(rana), or a Capybara for that matter, then Kyma sounds end up getting all of the MIDI information twice.
Once you have correctly configured your set up, and chosen Kyma mode in the Continuum Editor (or by selecting a Continuum User patch that was save with the setting), the Continuum Editor will look like this if everything is working properly:
The important detail to notice is that a number of the Continuum settings are now shown in blue. Those are now under the direct control of Kyma. For example Polyphony is now in blue because Kyma has set the polyphony to the polyphony value of the active Kyma sound. If those settings are not showing in blue then there is still a communication problem between the Continuum and Kyma that will need to be corrected.