The diffraction halo has formed in a recently condensed layer of high level stratus cloud. If the cloud droplets are super cooled (below zero C) the cloud is classed as cirrus. There is no easy way of deciding from a casual ground-based observation whether this cloud is high level altostratus below the freezing layer or low level cirrus above it, but I suspect it is supercooled cirrus water droplet cloud.
Because the sun is in the image clearly defined, physics types will be able to find the droplet size to within 10% remembering that the first ring of the diffraction pattern is overexposed and not seen. The angular separation to the first visible ring is to the second ring of the diffraction pattern that is the same for obstacles (water droplets of approximately uniform size) as it is for a random distribution of holes of the same size (a point that often puzzles students when they first encounter the phenomenon.