700R4 Clunking and slipping

[Smokintire70]

I'm quite worried about this.... I've got a 700R4 with a real mild shift kit. It backs a Ramjet 350. So it's 351 horse and 403 torque. It has just recently started to slip- the engine keeps running and slowly revs higher and the tranny finally catches up (it takes about 1-2 seconds) and it surges forward. Not a real firm jerk but a quick pulling as if I hit the gas a little harder than usual. I hope I'm not losing a tranny. Any help? Thanks guys!