From The National Geographic:
It looks like a rainbow that’s been set on fire, but this phenomenon is as cold as ice.
Known in the weather world as a circumhorizontal arc, this rare sight was caught on film on June 3 as it hung over northern Idaho near the Washington State border.
The arc isn’t a rainbow in the traditional sense—it is caused by light passing through wispy, high-altitude cirrus clouds. The sight occurs only when the sun is very high in the sky (more than 58° above the horizon). What’s more, the hexagonal ice crystals that make up cirrus clouds must be shaped like thick plates with their faces parallel to the ground.
More here.