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this atmospheric phenomenon is known as a circumhorizontal arc, which occurs when the sun is at least 58° above the horizon and the hexagonal ice crystals which form cirrus clouds become horizontally aligned.
photos by (click pic) bryce bradford, daniel m shihi, orne veien, brooke anderson, brian plonka, lisa gonnelli and angel villanueva near california’s vandenberg aerospace station, which actually shows refraction through a rocket trail.
see also: more circumhorizontal arcs, asperatus clouds, mammatus clouds, polar stratospheric clouds and cloud iridescence
I’ve seen this and always wondered what it was. The sky rainbows, explained & documented