Blue Tooth Magic mouse not tracking well

If you are using El Capitan 10.11.6 as your profile says, then that is probably why your mouse is no longer fully functional. There is a new mouse meant specifically for El Capitan and later OS's and with Sierra coming in the next two months or so, it may be time to get a new one. Bit of a nuisance, I know, but the old mouse is now several years old and with the technology changes you can only update so much.

I may have misunderstood you here having noted the phrase 'Fully Charged' . If you have a magic Mouse version 2, the one you charge with a cable to your USB you have the correct mouse and we must look for other reasons like interference etc. Have you read this document from Apple?

Potential sources of Wi-Fi and Bluetooth interference - Apple Support

One other thought. Have you checked the cleanliness of the optic?

Take a Q tip and dampen it with water. Turn off the mouse and gently apply it to the optic. Then turn on and test.

If it still doesn't work you can turn off and try dampening it with alcohol. Leave it a few minutes then turn on and try again.

Happy to have helped. If it repeats, use whisky next time. But remember, only dampen the Q tip, too wet can cause electrical faults.