Trans cooler

Yo Matt,
As advised, and;
Fluid leaks are typically caused by a defective cork gasket or rubber seal. The most common source of a fluid leak on a C6 is at the transmission’s pan, located on the bottom of the transmission. Engine oil should not be mistaken for transmission fluid, with its distinctive pink color. Between the pan and the transmission is a single cork gasket. Pay particular attention to the area surrounding each of the C6’s 17 pan bolts. Located on the driver’s side of the transmission is the black speedometer cable with its single rubber O-ring, as well as the two cooler lines. At the front of the engine, between the engine and the transmission, is the torque converter. On the engine-side of the torque converter is a drain plug, which will sometimes leak. At the back of the transmission is the extension housing. The extension housing is the metal portion of the transmission that the driveshaft enters. Upon disassembly, the extension housing is unbolted and separated from the body of the transmission. Between the housing and the transmission is a gasket. Inspect the bottom of the gasket for signs of leaks.

Possible causes;
Cooler or its line is plugged causing quickly rising fluid heat.
Member ZIGGY wrote "If you have an access panel over tranny you might be able to reach the vent through the panel. The vent is pressed into the tranny and has a cap that should be loose on it (has a small spring under it). If cap is not loose, you will have to see if you can free it up, it's only crimped on and there a rubber gasket in the cap. You should be able to at least see if it is puking tranny fluid. Also check around your dip stick for leakage, if it is leaking, the O-Ring/packing is probably bad. In order to change it, you will have to remove one of the tranny housing bolts (top R/H bolt on pac side) that holds the dipstick tube. You will have to drain some of the tranny fluid first before you pull the dipstick or else it will drain out of the hole. Pull dipstick tube out and replace the O-ring/packing. I always put a bead of RTV around the tube just above the O-ring to help seal the tube." @ C6 leaking/ blowing ATF

Converter drainback check valve is intermittently failing to seat. If so, the converter drains half or more of its fluid back into the case, raising the fluid level and causing fluid to leak out, usually through the vent.

BTW, some add a vent hose extension, such as
Installation in an 89; Dana 44, 1356 transfer case, C6 transmission & Dana 60
Source: by Andrew K (Andy351, das panzer, sloppy seconds, the magic carpet) at FSB
Pics are gone so see them @ 1989 Ford Bronco Extended Breather Lines pictures, videos, and sounds | SuperMotors.net
Andy wrote, "my previous method of a tranny breather had fallen off, so i needed to get a male adapter to fit inside the tranny's hole.
i used some random silicone i had laying around, but it didn't hold. i ended up using krazy glue, which believe it or not worked.
the angle of the hose was not allowing it to hold in, so i used a 90* bend to get it right. the angle of the hose was not allowing it to hold in, so i used a 90* bend to get it right."