What am I doing wrong?

Good on ya mate. (Speights Ale add GIF)

Please dont shoot anything live until its had a once over. stick to paper targets for now, and agree with shooting a piece of pine to see penetration.

At a 1ft range there isn't a feather out there that will stop a pellet from a 8ft/lb+ air rifle. I have a Hammerli 850 0.177 CO2 rifle running 11ft/lbs. It will put a hole straight through a rabbits head at 20yds, so a rooster head at 1ft has no chance.

With it shooting high at such an obviously low power I reckon the previous owner fired it with the barrel cocked. This has bent the barrel and damaged the piston head and/or spring. You need to get it checked out.

Hello, cold night last night so both roosters incautiously came down to sleep with my chickens and I was able to grab and cull them and once the deed was done made the following experiments while getting them ready for the pot.
Slug to any body part which is covered with feathers, at one foot range, doesn't even go through the feathers. Slug to bald facial area goes in about a quarter inch. Could not find any sign of injury to skin on either bird once plucked. Now in soup pot on back of wood burner, will check bottom of pot for pellets but suspect there will be none. Do not think I will be bothering any possums with this gun, but am enjoying pinging apples off fence. I wonder if a .22 would work better on possums, they know all about Timms traps, only ever got two, then found one using it as a picnic table to eat my pears grr.
Cheers, Ahudot

Thank you both, even with the sight wound right down flat it is still high, but I know how high so can allow. Hadn't noticed much in the way of recoil, but will check the artillery hold out. 

If it shoots high even when level then you need to adjust the sights properly. I think that maybe you should practice some more before shooting live animals so that you can be sure of humane kills.

1000fps is the 'marketing' number achieved using the lightest posible pellets and doesn't mean much in the real world. However, this rifle using Trophy's is easily capable of taking out any bird at up to 30m with a head shot. The shot at 3" would have passed straight through the head and could have missed the brain (it's pretty small).

If you are shooting straight up into a tree you need to aim a couple of inches low because the trajectory is a lot flatter than shooting along the ground. You could be missing over their heads, which would certainly wake them up.