Fire rainbow in the sky!

Fire rainbows occur when sunlight and cloud ice particles align perfectly to create a prism that hangs beneath the sun and looks like a rainbow in the shape of flames

Not actually made of fire or a real rainbow, a fire rainbow or circumhorizontal arc appears when sunlight passes through the ice crystals in cirrus clouds, according to the UC Santa Barbara Department of Geography.

When the light and cloud particles are perfectly aligned, the crystals act as a prism and refract the light in what commonly looks like a rainbow.

An amazing effect, referred to as: Iridescent clouds are a diffraction phenomenon caused by small water droplets or small ice crystals individually scattering light.

 
Cloud iridescence is the occurrence of colors in a cloud similar to those seen in oil films on puddles, and is similar to irisation. It is a fairly uncommon phenomenon, most often observed in altocumulus, cirrocumulus, lenticular clouds and cirrus clouds. The colors are usually pastel, but can be very vivid. Iridescence is generally produced near the sun, with the sun's glare masking it, so it is more easily seen by hiding the sun behind a tree or building. Other aids are dark glasses, or observing the sky reflected in a convex mirror or in a pool of water.

 
Iridescent clouds are a diffraction phenomenon caused by small water droplets or small ice crystals individually scattering light. Larger ice crystals produce halos. 

If parts of clouds have small droplets or crystals of similar size, their cumulative effect is seen as colors. The cloud must be optically thin, so that most rays encounter only a single droplet. Iridescence is therefore mostly seen at cloud edges or in semi-transparent clouds, and newly forming clouds produce the brightest and most colorful iridescence. When a thin cloud has droplets of similar size over a large extent, the iridescence takes on the structured form of a corona, a central bright disk around the sun or moon surrounded by one or more colored rings. In one instance a lunar corona was observed, with the iridescent cirrus cloud 11-13.6 km (36,000-45,000 ft) above the mean sea level at a temperature of −70 C (−94 F). The pure corona was 9.5 km (31,000 ft) above the mean sea level, at a temperature of −60 C (−76 F).