These colorful clouds are called iridescent clouds. When you see a cloud like this, you know there are tiny ice crystals or water droplets in the air. Larger ice crystals produce solar or lunar halos, but tiny ice crystals or water droplets cause light to be diffracted spread out creating this rainbow like effect in the clouds.
I love seeing these in the sky. When I was a kid, we use to call them ‘sundogs’. I still do, lol. 🙂
Thanks! I have only seen them a few times, so I was glad I had a camera for these.