this is almost always a failure of the "overdrive" electrical circuit, which enables 4th gear. People write "help" messages here and on other boards reporting that their 240 tranny dropped from 4th gear into 3rd gear and will not shift into 4th gear anymore, or does so erratically, in and out of 4th. My car is now a permanent 4-speed, all day, and it does not depend on the operation of an electrical circuit to give me 4 forward gears. I eliminated the mis-named "overdrive" electrical circuit on my car, completely, by altering the overdrive solenoid so that it ALWAYS allows operating fluid pressure to the 4th gear circuit in the transmission.
Instead, I am going to tell you how to fix your car, for good. I am not offering the Volvo mechanic's "by the book" answer to problems with this circuit, nor am I going to tell you how to "keep it original," or how to perform microsurgery on sealed relays. By the way, if you doubt my mechanical bona fides, I'm a retired nuclear submariner and this little overdrive circuit issue is small crackers.
I'm going to try to help some poor souls by writing to this board again, although I know the snipers lie in wait to abuse me again on this subject. There have been many posts here on failure of the 240 A70/71 automatic transmission overdrive electrical circuit, some of them quite bitter and competitive - check the archives.