More detail needed there... What size cassette, and which generation of XT mech? 10 speed XT will only really fit a 36t max cog for example. There's ways around it, but they are compromises.
This forum is useless for pictures, it makes them tiny. Something doesn't look right, but it's difficult to say what exactly. Can you upload them to somewhere else and link to them so they're easier to see?
What you've highlighted is the B screw, and it does look like it's all the way in. I'm not sure the B-link is fitted correctly though, which is the bit that actually attaches to the frame. It looks like it should be more horizontal, which pulls the entire mech around. The cable looks like it's pulled very tight in one of the pictures too, which adds to this theory. Try loosening the bolt which holds it to the mech hanger and rotating it back, there should be a stop on the B-link which interacts with the nubbin on the mech hanger.
Hanger looks fine. As whyamihere said, loosen the derailleur fixing bolt, rotate clockwise and there will be a tab (picture 1) that sits on top of the tab that sticks out of the hanger (picture 2). Not the most accurate but you get the idea.
Thank you Reaperactual,thats what i thought.Mine misses the hanger as i think the hanger has been damaged.I have a new one,which i will fit today,On the way home as is it worked flawlessly.I also have some new outer sheathing so i can loosen the cable.Thank you all for the help.
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As you can see from the pics the b screw is in as far as it will go.The cassette is an 8 speed.The derailleur was sold to me as an 8 speed.
Thanks for replies
Is that the b screw? If yes how do i get it where it supposed to be.