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You may wish to refer to the kickdown cable adjustment section in the 700/900 FAQ, same AW70/AW71 trans as yours.
https://www.brickboard.com/FAQ/700-900 Transmission: Kickdown Cable Adjustment
As noted there, start with the proper adjustment where when the cable is plucked all the way out and released you can just hear the pawl on the other end of the cable way down in the trans kickdown chamber go thunk against the bottom of the chamber, then back off the adjustment until the thunk just goes away. You may not find that procedure in manuals, but it is the correct method that was taught to the Volvo Vista techs.
If you want, you can try adjusting the cable a little tighter for a slightly more aggressive kickdown response, say by a few nut faces on the adjuster nuts. When replacing a cable, I always do that as a) I prefer a slightly more aggressive response to my foot and b) a new cable will slightly stretch over time and become slightly misadjusted. More aggressive shifting is not always what you want when going up a long hill at highway speed and trying to stay below the shiftdown sweet spot, dropping from overdrive all the way down to 2nd. Conversely, you can loosen it a little for a slightly more delayed response. There is a slight advantage to adjusting it a bit on the loose side in that the throttle will be able to open a little wider before a kickdown is forced when the pawl goes past the forced kickdown detent position which you can feel when the pedal goes to the floor and meets resistance.
As noted, you need to do this is in a fairly quiet area and additionally the trans shouldn't be so grungy that there is an excess of crud in the bottom of the kickdown chamber so you can't hear the metal pawl striking metal. With that in mind, it is always best to note the number of nut faces you have turned the adjuster so that you can get back to the original position if you can't complete the adjustment. There is a Volvo adjustment spec for the kickdown cable you will see in some manualas and TSBs for the distance between the end of the adjuster sleeve and the little brass ferrule clamped on the cable, but that is more for initial adjustment and as I noted in the FAQ if it is a replacement cable then that ferrule has been clamped in position by the installer, not the factory, and is a less reliable reference point.
Just FYI, you can think of the pawl I'm mentioning as more or less a wedge shaped lever, spring loaded on a pivot. The cable moves it up and down in the kickdown chamber to control the flow of fluid through the chamber, which is kind of small matchbox sized. Also FYI, the orange plastic thing you're mentioning I'm assuming is the cap on the end of the adjuster sleeve which is there to prevent dirt from getting into the cable sheath.
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Dave -still with 940's, prev 740/240/140/120 You'd think I'd have learned by now
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