A failed module usually occurs on 96 and 98 models. (Check your doorplate and note the date of manufacture of your vehicle.) Since it's a 93 or 97. I would first investigate a faulty ignition switch. Some have diagnosed the problem with an old fashioned empirical test: if the ABS/TRACS light is on, turn off the car, jiggle the key in the ignition, restart. Did this turn off the light?

If it's the ABS module, you could have the car scanned for codes - there are telltale codes for a failed module. (In the 1998's, for example, the telltale code is for a failed RR wheel sensor - that's the circuit that gets broken on the ABS board for this model year.)

Of course, you could have a fouled sensor (or circuit).
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David
1998 S70 T5SE // misc mods (mostly lighting) // red calipers
1992 940 GLE // Hella Micro DE foglights and 170K

I had the same problem on my 96 855R. Volvo did a complete redesign of the ABS/TRACS system for the 850 starting with the 96 model year, this redesign placed the ABS controller right under the brake modulator, and as it was explained to me "over time vibrations from the brake modulator can and will cause micro fractures in the PCB of the ABS controller which causes temporary signal loss and the system to fail sporadically..." While this doesn't affect normal braking, when the ABS/TRACS OFF lights are on the ABS and TRACS will not function.

One other possibility that happened on a friend's 95 850 GLT is the electrical connections to the key ignition are failing. An easy way to test if this is the case is with the ABS/TRACS lights on (and the car started), gently twist the ignition key back slightly, not enough to turn the car off but just before the accessory position, if it's the ignition, when you do this the ABS/TRACS lights will turn off.

Normal for ABS to engage during those circumstances... The weight of the car shifts making the that brake grab more and abs releases it.

Solution is not to drive that fast over the bumps.