I have had the same problem for awhile. I just finished replacing the cable, VSS, and the speedo gear. When I took everything off the car I connected the everything and put a drill on the end of the VSS. The needle jumped. I did this again with the new cable and VSS and the needle was smooth.
I bought the speedo cable from 50resto. Its not a ford part and doesn't fit the same. The speedo socket is shaped differently and didn't fit with the clip that it comes with. I used to old one from the stock cable and it works fine. The cable is also a couple inches longer but it makes it a little easier to pull the cluster out of the dash.