Hi all,
I have created a plan with following setup:
- issues grouped in epics
- added estimates and team
- created team with 1 week iteration length and 37,5h capacity
- used only one dependency
I have turned on sprint capacity view and used auto-schedule, as a result I have a plan that looks like this:

I wanted to try out manage sprint capacity option that was described here so I changed it for Sprint 1 to be 3 days instead of default 5.

By clicking on Auto-schedule I would expect work that is currently in sprint 1 to be moved to the following sprints. What actually happened is that all work is assigned to Sprint 1 and it gets even more overbooked.

This are the options I used on Auto-schedule:

What is causing this issue? Am I doing something wrong?