1996 Volvo 850 Tranny Binding

Transmission problem
1996 Volvo 850 4 cyl Front Wheel Drive Automatic 154K miles

My vehicle and transmission ran fine until one morning I tried to start it and I put it in reverse. There was a clunking noise and the car came to a halt. I got out
there was nothing in the way. I tried to go forward with the same effect. Rocked the car back and forth to see if that old trick worked, it allowed me to move the car back into place in the driveway. I have a sport and econ switch to improve performance on this model. I always use 'sport'. Could this make a difference, or is my tranny shot or nearly done? AT fluid is full and looks OK. No heavy foaming or dirt.