The valve body is the control center of the automatic transmission. It contains a maze of channels and passages that direct hydraulic fluid to the numerous valves which then activate the appropriate clutch pack or band servo to smoothly shift to the appropriate gear for each driving situation. Each of the many valves in the valve body has a specific purpose and is named for that function.
For example, the 2-3 shift valve activates the 2nd gear to 3rd gear up-shift or the 3-2 shift timing valve which determines when a downshift should occur. The most important valve and the one that you have direct control over is the manual valve. The manual valve is directly connected to the gear shift handle and covers and uncovers various passages depending on what position the gear shift is placed in. When you place the gearshift in Drive, for instance, the manual valve directs fluid to the clutch pack(s) that activates 1st gear. it also sets up to monitor vehicle speed and throttle position so that it can determine the optimal time and the force for the 1 - 2 shift. On computer controlled transmissions, you will also have electrical solenoids that are mounted in the valve body to direct fluid to the appropriate clutch packs or bands under computer control to more precisely control shift points.