The former world No.1 had every reason to be pleased after firing an eight-under 64 on Thursday that placed him just two shots adrift of leader J.T. Poston (62).
Day had two eagles, four birdies and a lone bogey at La Quinta Country Club to be tied third.
His two eagles, on the sixth and 13th holes, were chip-ins as the Australian illustrated his razor-sharp short game.
Day chipped in three times in a round when his short game was immaculate. (AP PHOTO)
"Pretty good. Short game was nice," said the Queenslander.
"Obviously chipped in three times, that usually helps, two of those were for eagle, so that's always nice to be able to be in position to give myself a good chance at birdieing the par-5s here, because obviously you got to capitalise on the opportunities here.
"Early days, so three more days."
The tournament is being played over three courses with Poston carving out his 62 on the Niklaus Tournament layout, and the other being the Pete Dye Stadium Course.
Day will take on the Stadium Course, where he had his practice round, on the last day following a 54-hole cut to the top 65 and ties but is not prepared to look that far ahead.
"I did play the practice round on Monday. We played it during the windy day. (On) 13, I landed it three paces on and it bounced 35 paces.
"I'm interested to see the scores, see what the guys shot out there, and where some of the tee locations are ... all three golf courses can be gettable if you're playing well, so I just got to take it a day at a time."
Compatriot Cam Davis played the Stadium Course and posted a three-under 69.
Davis had five birdies but was stung by a double-bogey on the seventh, which saw him drop to tied 65th by the end of the round.
Carson Young, Nick Taylor and Jackson Struber were the best of the contingent taking on the Stadium course, and their seven-under 65 left them in a tie for eighth.
Day has a gameplan which he believes will keep him in contention.
"As long as you can stay in front of like six-under per day, I think gives you a pretty good chance."
Poston leads by a shot from Justin Lower with a five-player posse including Day, JJ Spaun and Joel Dahmen, on their backs.
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