The white circle appears when the opponent presses the parry button and it doesn't block any melee attacks during its active frames. It then starts disappearing over the course of 4 seconds, indicating to you as a player that their parry is on cooldown.
If however, the opponent makes the parry successful (in other words blocks a melee attack) the white circle and disappearing for 4 seconds is still happening (again indicating to you that their parry is on cooldown) although that information is incorrect since opponent has parry already available.
If however, the opponent makes the parry successful (in other words blocks a melee attack) the white circle and disappearing for 4 seconds is still happening (again indicating to you that their parry is on cooldown) although that information is incorrect since opponent has parry already available.