How do I detect water damage in my ipod 5

Hi. Check this article: Liquid damage to iPhone or iPod isn't covered by warranty - Apple Support

You are lucky one if it still works after contact with water. Usually devices and water do not mix and water damage is not covered by warranty. Corrosion has already started. I would schedule a genius appointment in the Apple Store to estimate the level of damages. They will offer you the best solution.

The liquid indicator is a poor judge of liquid damage since high humidity can change the color to red.

Typically liquid damage manifests itself by the inability of the iPod to turn on or the screen does not work.

Try:

- Reset the iOS device. Nothing will be lost

Reset iOS device: Hold down the On/Off button and the Home button at the same time for at

least ten seconds, until the Apple logo appears.

- Reset all settings

Go to Settings > General > Reset and tap Reset All Settings.

All your preferences and settings are reset. Information (such as contacts and calendars) and media (such as songs and videos) aren’t affected.

- Restore from backup. See:

Restore your device from an iCloud or iTunes backup - Apple Support

- Restore to factory settings/new iOS device.

If still problem, make an appointment at the Genius Bar of an Apple store since it appears you have a hardware problem.

Apple will exchange your iPod for a refurbished one for $99 for 16 GB 5G and $149 for the other 5Gs. They do not fix yours.

Apple - iPod Repair price