"Sword mode" refers to a setting or form of a weapon, usually a sword, where it is specifically designed for close-range combat by maximizing its cutting or slashing abilities. Full definition
As you attack foes in sword mode, a compartment in the hilt eventually begins to glow yellow or red; once it does, you'll be able to charge it up with energy. (polygon.com)
The combat isn't just mindless chaos: the game rewards you for smart kills, and you can use a free - swinging sword mode to precisely cut your enemies in a way to absorb more energy and get more points. (lifewire.com)
It's available in two modes: a «sword mode» which is actually a sword and shield, and an «axe mode», which you unleash when you attach the sword to the shield. (polygon.com)