Core terms
First red day
The first session after a large up move (or a run of up days) that closes below the previous session's close. It is distinct from a red candle, a session that closes below its own open.
Traders use "red day" for two things. A first red day compares today's close with the previous session's close; a red candle compares today's close with today's open. A stock can open 15% higher on day two and close below that open but still above day one's close: a red candle, not a first red day (Illustrative).
The two rates differ. Of 665 sessions that opened at least 20% above the prior close, 208 opened day two above day one's close; of those, 69 (33.2%) closed below day one's close (first red day) and 116 (55.8%) closed below the day-two open (red candle) (day ones 2026-07-01 to 2026-10-01; FennEdge archive; as of 2026-10-02).
The label needs the session close, so it describes a day afterwards. A condition such as "opened above day one's close" is knowable at 09:30 and can inform decisions; the label itself is not an intraday filter.
What traders should verify
State which definition your log counts, and record conditions known at the open (day-two gap, overnight filings) separately from the end-of-day label.
Do not conflate
Trader usage; there is no official definition. Many write-ups mix the two meanings of "red day". Using the label as a filter for entries on the same day is look-ahead, and an overnight filing such as an offering can change day two entirely.
Primary source
Trader usage: there is no official definition, and platforms and tools may calculate it differently.