Hi

This is usually cause by 1 of 2 things

1)A dodgy screen connector, try reseating it and cleaning the connectors(both screen and board) with some isopropyl alcohol

2)A broken screen, this is there more common of the 2 occurrences ,although the screen looks ok from the outside it can be internally damaged causing this issue to happen, you will most likely need to replace the display if reseting and cleaning doesn't work

Here's the guide you may need

Apple Watch Series 2 Screen Replacement

Hopefully this helps

Any questions please ask

Thanks:-)