The misleading term “fire rainbow” is sometimes used to describe these phenomena, although they are neither rainbows, nor related in any way to fire.
This cloud phenomenon is known as a circumhorizontal arc which is an optical phenomenon – an ice-halo formed by plate-shaped ice crystals in high level cirrus clouds. How often a circumhorizontal arc is seen, depends on the location and the latitude of the observer.
See it in action:
Formation of the halo requires that the sun be very high in the sky, at an elevation of 58° or greater, and that a cirrus cloud or haze be present and contain plate-shaped ice crystals. The sun’s altitude determines the visibility of the halo.
|Photo: Ravenna, Michigan|