I have a 1989 1/2 ton 4x4 chevy truck and the speedometer works at random times, I've replaced the sensor on the tail end of the transfercase and checked the wires all the way up to the firewall under the hood and they look good, so what could be the reason its doing this?

Replace the Vehicle Speed Sensor (VSS). You merely replaced the Transmission Speed Sensor in the transfer case. If the problem persists, the IPC may be bad.