It easily rotates 90° by hand.
After rotating it:
It’s a clutch mechanism to stabilize the chain, particularly useful on unpaved terrain. It makes the derailleur stiffer and lessens chain slack.
Is there an orientation that it should be set to?
Afaik, you can leave it in the stiff setting without worry. If the shifting is not setup properly, it could lead to less smooth gear changes. You should deactivate it if you need to set the shifters and move the derailleur - for example to remove the back wheel.
Edit: the system is called “Shadow Plus”, here explained on the Shimano website.
This is on a Shimano Ultegra di2 derailleur that doesn’t say rx on it. It definitely doesn’t feel like a switch since it’s smooth to rotate either direction. It doesn’t click into place or give any tactile feedback.
Ok, I only have experience with it on the GRX groupset, maybe someone else can chime in on the Ultegra version. Maybe another picture with a wider frame could help :)
Good idea. I added a few more pictures. Thanks anyways, I didn’t know what shadow plus was before.
Bingo! I discovered that it is an optional wire holder.
