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my understanding is that the modulator helps it to shift smoothly. mine was bad years ago and it would kindof bang through the gears. donno if it would cause your problem.
The vacuum modulator measures engine load and controls upshifting. When the modulator goes bad, the transmission will typically shift at high RPM's. To see if it is bad, pull the hose off and see if there is any trans fluid in it. Presence of fluid means it's bad. Easy to change, and runs about $20.