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a. Start out with a file 80 x 80 px. We are using a relatively small canvas in this tutorial to keep the file size low.
b. Now go to Edit>Preferences>Guides, Grid and Slices...
Use these settings:
Gridline Every: 80 pixels
subdivisions: 16
c. View>Show>Grid to show the grid or hit Ctrl + '
d. Use the circular marquee tool to make a selection like this. Make sure you hold shift while making the selection, this will insure that it is perfectly round. Also pay attentionthat the selection is 2 blocks from each side.
e. After you make sure your selection is in the right place go to Edit>Stroke...
use these settings:
Width: 5 px
Color: Black (000000)
Location: Inside
Mode: Normal
Opacity: 100%
make sure that you don't do the stroke on your background layer. It needs to have it's own layer.