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Are you really sure that it goes away when you are inside? Have you tried a bright flashlight to see if you can spot it. It almost looks like a defect or spot of glue on the back side of your glass.

Yes. That is the first thing that I did.

Also, has it always been there or is this "spot" something new that you just noticed.

The spot started appearing around last month.

I would run it by the Apple store, they might just replace as a factory defect.

Sadly there is no Apple Store open yet. The closest one will be in Singapore, but it will still open this November. https://www.macrumors.com/2016/07/27/first-apple-stores-singapore-mexico-photos/
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amazed you tried the immersion test, being out of warranty

I figured that if the Watch is really IPX7 certified, water should be like nothing for it.
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it appears that the issue is the very small, sharp circle near the center of the screen. That doesn't look like condensation to me.

The problem is not that small dot on the screen. That is just a little droplet of water that could be rubbed off with a piece of cloth. The problem is on the bezel of the glass panel. Look at the lower right corner of the bezel. That is what I'm talking about.
 
That looks like it's on the outside of the glass?

Are you sure it's not just your cold watch condensing moisture in the hot humid air?
Does it go away if you spend more that a "few minutes" outside every hour.
Maybe it's just on the one corner because the oleophobic coating has started to be rubbed off there.
 
That looks like it's on the outside of the glass?

Are you sure it's not just your cold watch condensing moisture in the hot humid air?
Does it go away if you spend more that a "few minutes" outside every hour.
Maybe it's just on the one corner because the oleophobic coating has started to be rubbed off there.

It's definitely under the glass. It gets worse the longer I stay outside and slowly goes away when I get inside.
 
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