I have an 88 with the stock 305 and put a new radiator in a few years ago and just replaced the bypass valve. The coolant and reservoir are full to the proper amounts. Normally while running it's at the first line on the temp gauge but recently its jumping up to the middle line and back down to the first line the whole time I'm driving. Is this fine as long as it's not overheating?

 

If it’s not overheating it won’t cause any damage but it’s not normal. I would initially suspect a sticky thermostat. Bypass valve should have no relation to this.

 

Thank you. I will check that out