Can someone explain calorie deficit?

You checked what box to show your deficit?

I think that's only relevant for calorie tracking devices like fitbit etc

All it means is that if your fitbit has you burning less calories over the whole day than your MFP calorie goal is set to, then your fitbit will adjust your MFP calories down to reflect that.

OK, so I'm guessing you want to understand how your fitbit affects your net calories on MFP - hope that's right, and that this will help:

On MFP you pick your activity level, based on how most days are for you. Let's say you chose lightly active. MFP estimates the number calories you'll burn based on your body data and that activity level.

You also wear a fitbit. It measures your ACTUAL activity level, using steps. So it's pretty good at measuring walking, running, normal daily activities like shopping or going up and down the hall at the office - anything step-based. It tells MFP what your real activity level was each day.

MFP compares what the fitbit said to the estimated calorie burn it got from your "lightly active" guess. If the fitbit data shows you were actually sedentary, MFP reduces the number of calories available to you that day (that's what the "negative adjustment" is). If the fitbit shows you were MORE than lightly active, it gives you more calories in your daily allowance.

The idea is that you are trying to maintain a certain deficit (for example, 500 calories per day to lose 1 lb per week). MFP will use your fitbit data to adjust your calories in real time to hit that exact deficit. It works great, just go with it!

Caveat: MFP will never tell you to eat less than 1200 calories per day, no matter your fitbit data say.