Hard to tell from the picture... does it kind of look like this?
Could be bad RAM... The ROM sockets are also known to be flaky. And you'll want to check the reset circuit to make sure that it is working as well if you haven't already (instructions
here)
Unfortunately there is no self-test on these boards, you could see if someone can hook you up with a test rom. Or if you get the
Braze Multi-kit (which just happens to be on sale now) there is a test function built into it.
There is a RAM test you can do too. You have to remove the ROM chip at location H.
After removing the rom, power up the board. You should get something that looks like a series of parallel lines (like in this video):
If you get a picture like that, then the CPU and RAM is
probably working OK. If you are not getting this even pattern, if there are breaks or dots on the screen, then there could be a problem in RAM.
I found this helpful:
http://www.brentradio.com/images/SpaceInvaders/midway_8080_test.pdf and actually Brentradio's site has a lot of Space Invaders info.
On mine, I got the Braze kit, and it fixed the issue (I'm assuming it was flaky rom sockets or a bad rom chip)
Of course, you could always send the board to elektronforge, they can test it and repair if needed.