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Alright, you can't take this the wrong way but... Your wiring is the worst I have seen. But you have atleast made a good attempt by reading the instructions and asking for help.
#1 get rid of the speaker wire and get some automotive color coded wire, it makes a diffrence.
#2 Use crip connections at the very least, soldering is the best. Use butt connectors for wire to wire connections and ring terminals for the ground and sender to wire connections. When you just wrap the wire arround the post or another wire the voltage and signal won't be constant and will give you nothing but problems, not to mention it can cause your car to catch on fire.
#3 There is only one wire that comes from the sender and goes to the guage according to the instructions that you have given. I see one coming from the ground and another wire going to the guage. Its grounding itself out.
#4 Take the black wire from the guage and attach it to a body ground (the instructions suggest somewhere in the engine compartment) but NOT to the sender.
#5 use a ignition switched 12V power source for power (red wire)
and use an in line fuse, please.
#6 Attach the blue wire ONLY to the sender. I think your putting to much detail on that cardboard washer thingy. If it gives a detail on how to do it then do it that way.
#7 attach the purple wire to ground if you want full illumination all the time (and thats probably best)
Thats how I see the guage to be installed according to the instuctions you have given. And only one wire to the sender!
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