The transaction is started in parentLevel() when you then call second level that is also annotated transactional then the already created parent transaction is propagated to the second level. When then something in the second transaction fails it marks the transaction to be rolled back (even if you use retryable) what you would need to do is to open a new Transaction that you make Retryable that would solve the issue.

Check this out for more https://medium.com/@ayushgupta60/springboot-retry-transaction-marked-as-rollback-74ab21733469