That prompted a thought.

byeatts, do you have a sunroof? Has the area of your front passenger floor been wet?

The TCCM (Transfer Case Control Module) is located right by the BCM, they do not like to get wet. If the TCCM goes bad, that also leads to a TC Fail.

No sunroof. As mentioned I also have been wondering if the position sensor in the motor is bad. The shift forks works and can manually shift in all gears., Very impressed with the response ewe guys have provide ,Thank You

Update, I found a broken wire to the axle sensor, Likely ice build up caused it, Splice it and it now shifts into low ,Hi and Hi lock perfectly. So the TCCM does read the Traction control sensor and will cause shifting failures , New one for me! However I still have a Traction control failure light on the dash, Wonder if it will need flashed to clear?