Slightly different model of the same rear derailleur below. I also suspected chain too short. However, my own philosophy is not, to make the chain as short as possible (big/big combo plus a couple links), but as long as possible and still be able to take up the slack on the small/small combo, that way, the derailleur cage is not wound up as tight, makes things like cage springs and derailleur pulley bores last better. It also gives me enough chain to upgrade from my 30 low cog to a 32 or perhaps 34.
big/big:
small/small:
