Need help with lathe threading

I'm converting a lathe to CNC.
I have everything working except when it comes to threading.
I'm using an encoder that have 60 pulses per revolution, phase A, B, and Z
I can see the signals on all no issues there.

The problem I'm having is,
If the spindle is rotating above 120 RPM the thread pitch is off and motor at 120 RPM does not have enough torque to finish the threads.

It seems to me with the encoder I'm using I should be able to use much higher RPMs, I'm not sure what I'm doing thought when it comes to config files.

I'm using parallel port with a BOB.
Spindle RPM is controlled by hand, not by LINUX CNC.
What do I need to change? I'll attach my config files.
Thank you guys in advance!
 

Do you get latency warnings wen starting and enabling LinuxCNC?

Nope, no issues there.

OK
Is the encoder cable shielded and grounded on the electronics side?

It's shielded but I did not ground it.
What would be a proper spot on the BOB to ground it?

Thank you tommylight for helping!

Re: I'm using an encoder that have 60 pulses per revolution, phase A, B, and Z

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Just a thought is the encoder Z setup with one to one to the spindle

1:1 gearing on the encoder, yep.

OK, I've grounded the encoder, let me do a quick test and I will get back to you.

OK, with encoder grounded, running 200 RPM.
Pitch is smaller then it needs to be.

Here is a picture
Right side is correct pitch
Left side is what I've got, (wrong pitch, smaller) So no change so far.

 

if you think your encoder setup is correct - are you sure your Z axis scale is correct?