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fuel guage
I had the same thing on my 92 400E. It is a reoccuring problems on the W124's. I replaced the fuel tank on my 400E with the larger 500E tank(18.5 VS. 23.1 gals) The tank came with a fuel sending unit. After replacement, the quirky/jerky movements were no more. The sending unit is located on the top of the tank. You just take out the trunk lining(the tank rests against the back seat) and you'll see it at the top towards the center of the tank.
Before replacing it, try cleaning off the contacts of the unit and those of the wire connector. Use an abrasive, like a wire brush/sand paper or something. You'll need something very slim to fit into the connector. Its the same sore of problem that causes the cooland light to dimly glow on these cars.(if you haven't encountered that problem yet....just hang on, you will). For that problem, I recommend that you replace the coolant level indicator(its the little metal dohickey that the wires plug into at the bottom of the coolant reservoir)
Pleasant driving
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