Welcome to CTOA Post,
I used to own a LW-6.
The swing cylinders are single acting. The brass fitting in the end is an air filter to keep dirt and debris out of that end of the cylinder.
What has happened in your case is the cup seals on the piston have blown, letting oil by, and collecting in the unused portion of the cylinder.
Time to repair or replace that cylinder. My guess is that you were using boom swing to move dirt with the side of the bucket – that's a no-no with these particular hoes. Kits are available through Circle-G and various other dealers that support this site