Use MOD -> Type -> AM to select modulation
Set Frequency to your carrier frequency ( e.g. 1 MHz )
Set AM Freq to your modulation frequency ( e.g. 1kHz )
Set AM Depth to 100%
Set offset to 0
The "AM Frequency" (modulation) will define the "envelope" that you see on the scope display
The "Frequency" (carrier) will define the higher frequency that gets drawn as the "blurry" gradient on the scope.
Your horizontal time base on your scope should be set according to your modulation frequency, so you can see the envelope. The carrier frequency will be too high to see as a sine wave, it will be seen as the blurry gradient.
If you set the horizontal time base on the scope according to the carrier frequency, you will just see a regular sine wave. The modulation frequency is too low to be visible.