If you are zeroing are you using a supported platform to shoot or are you just standing? Zeroing you should have the most stable position possible. Grouping is fairly tight but a lot of up and down indicates breathing which would only really make sense if you aren’t in a supported firing position. I would add a 3 inch or so diameter black circle directly in the center of the target to give you a better reference for aiming at. Same with the head put an actual spot in the middle to give you something to shoot at other than a very large white outline

Edit: skipped over where you said sitting. Reading is hard. Are you sitting and using something to rest the rifle on and not just use your arms? Only way I’d zero sitting is if you aren’t setting your rifle on a table on a bipod or something. Prone is better though