After removing front and rear valve bodies, checking governor valve action, kick-down solenoid, TV (cable actuated) valve on valve body, action of 1-2 shift command valve and a few others, all I found was some dirt in one of the little screens in the rear valve body (as suggested by David S Poole). Everything seemed fine otherwise. I put it all back together with new gaskets and now transmission works fine. I guess it must have been the small amount of dirt clogging the thimble-shaped screen. This has certainly taught me to be more dilligent about trans fluid changes.

Thankyou all for the helpful suggestions!

Where exactly is this "thimble shaped" screen ?

Thanks,
:-) neil

Rear valve body?
Would you have a photo of that?

And yes I know... very old thread

Oops, OK I found it

http://www.bulkpart.com/Merchant2/graphics/Catalog-pdf/722-3.pdf

__________________
91 MBZ 300TE 4M 91 Jag XJS V12 94 Alfa Romeo 164 LS 80 BMW 320i 85 BMW 528e 86 BMW 325e 88 BMW 325e 88 BMW 325i 89 BMW 325ix 95 BMW 525i 96 BMW M3 78 Fiat Spyder 124 98 Land Rover D1 LSE 98 Range Rover HSE 4.6 93 MBZ 190E 2.6 96 MBZ C280 93 MBZ 400E 90 MBZ 300ce 71 MGB-GT 91 VW Corrado G60 97 328i 99 E320 Wagon 97 E320

https://lh3.googleusercontent.com/-t...r+sig+copy.jpg