Your linkage is not adjusted correctly
if screeching only when backing up, it sounds like you have a problem in reverse gear in transmission or you have a problem with loose pinion in differential
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It engages the band witch makes your tranny shift into gear.
I believe the 3.42 gear was the lowest gear you could get that year, what was standard I don't know.
It tells you your second gear start switch is on. When on, that switch makes the transmission not use first gear. This is good for icy winter conditions.
The temperature will keep the 1986 ford tempo automatice transmission to stay in first gear because this car was design for the cold. Changing the gear to early and a cold temperature could ruin the car.
It means that in 1st gear the engine makes 3.551 revolutions for every 1 revolution of the transmission output shaft. This provides plenty of power for take off and pulling.
the transmission is always in gear. if its not there is probably a stripped gear in the transmission.
If your stickshift makes a whining sound in gears, grinds when you are trying to put it into gear or if it slips out of gear you know it is going out.
The transmission casing contains the transmission and final drive gear.
Try changing transmission fluid - inexpesive first step Transmission may need internal service
if the noises are only in fourth gear then its an internal transmission problem. Make sure that the fluid level is ok. If the fluid is ok then the transmission will need to be pulled and checked inside.