Your cotyledons look long gone, you are losing true leaves. Soil mix might be too hot, they looked burned.
It's kind of tricky watering tiny seedlings in a large pot but it can be done. Leave it where it's at. Let it get dry between waterings. When you water put about 1/4 cup of water, slowly, right at the base of the stem. Then set it in a pan with 2" of water in it and let it suck water in the bottom of the pot for about 2 minutes. Take it out and let it drain, it's perfectly watered.
That would be safer than trying to transplant that small of a seedling, which is kind of tricky.