The jumping needle is usually caused by cable overstretch. Your instrument cluster may have been removed for whatever reason and the person didn’t disconnect the cable at the transmission end, he just pulled the instrument cluster out enough to slip his hand behind to disconnect the cable. This would have caused the cable housing stretch, which produces the typical needle jump at low speeds. All 124s should have mechanical speedo/odometers. If you look under your car you should see the cable attached to the left side (if memory serves me right) of the transmission.

Alex