Hole Punch Clouds are simply high clouds that look like somebody punched a hole in them. The name is not scientific and sometimes you hear it as Punch Hole Clouds but they look unusual. If you look you could probably see them fairly often when we have Cirrus clouds but usually they are not too dramatic. On December 11, 2003 the sky was dramatic over Mobile County, Alabama.
First, a layer of Altocumulus clouds moved in from the west. Even though these clouds were made of water droplets they were actually supercooled water. In other words, the temperature of the water was below freezing. These clouds were just below airplane condensation trails (contrails) indicating that the humidity was high at that level of the atmosphere. Then close to noon, within minutes, the blanket of Altocumulus clouds developed a hole. The hole turned out to be crystals of ice, transformed into regular Cirrus clouds, and then falling. By definition this was precipitation and since Cirrus clouds are made of ice crystals, you could call it snow, fallstreaks, or Virga. It evaporated well before hitting the ground. All of this is common but what was uncommon was the perfect circular shape that grew within a matter of minutes. Washington County, Alabama later saw a similar event on January 29, 2007.