If we look at the time lines for both, they are the same.
Both events:
happened in the past
happened over time / frequently
do not happen now
When do we use 'used to' and when do we use the 'past continuous'?
Used to
The events in 'used to' can be:
continuous (live, drink, work as a...)
frequent (visit, stay, go to...)
The events which are 'continuous' can be expressed using either 'used to' or 'past continuous'.
The events which are 'frequent' can be expressed using 'used to'.
Past continuous
The events in the 'past continuous' can be:
long-term
short-term
The events which are 'long-term' can be expressed using either 'used to' or 'past continuous'.
The events which are 'short-term' can be expressed using 'past continuous'.
Conclusion
If the event is long-term and continuous you can use either grammar.
If the event is long-term and frequent you must use 'used to'.
If the event is short-term and continuous you must use the 'past continuous'.
If the event is short-term and frequent you can not use either.
Why?
Let's take 'drinking coffee' and some time examples.
Example 1 - 10 years
It is long-term because 10 years is a long time. It is also a continuous event because you probably drink coffee every day.
Long-term + continuous = either
I was drinking coffee for 10 years.
For 10 years I used to drink coffee.
Example 2 - 1 day
It is short-term - you've only drank coffee for 1 day. Or, you are referring to that 1 day. It is, however, continuous. I imagine the coffee was in the morning.
Short-term + continuous = past continuous
I was drinking coffee this morning.
You can not say 'used to' because 'used to' is for long-term events. Doing something for one day and stopping does not qualify for 'used to'.
Now let's take 'travelling to Italy' and frequency examples.
Example 1 - 8 times
This is a frequent event and would likely happen over a few years. When it stops you can say:
I was travelling to Italy.
I used to travel to Italy.
Long-term + frequent = either
Example 2 - Once (1 time)
This is not a frequent event but it is continuous. The action happens over time. It would happen in the short-term (if it was a holiday).
I was travelling to Italy.
Short-term + continuous = past continuous
You can't say 'I used to' because you only did it once.
Last example: you see your friend twice (2 times) in one day
Because there are two events, it is not continuous. It is a frequent event. It is short-term and not so you can not say 'used to'.
Short-term + frequent = none
Conclusion
If the event is:
continuous and long-term = used to or past continuous
frequent and long-term = used to or past continuous
continuous and short-term = past continuous
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