From what you're saying, It sounds like you've got a bad igntion coil. If your test light gets a steady pulse when kicking the engine over, and it flashes in sync with engine rotation when attached to the orange wire, your CDI system is functioning. Replace the coil, and that should solve the problem.
First, though, be sure you have a good spark plug in the engine, and that the spark plug cap is firmly screwed onto the coil wire.