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We don't observe this phenomenon often. However, it is sometimes seen about 24 to 48 hours in advance of ice or snowfall.
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Basically what happens is that enormous quantities of tiny ice crystals form up in the stratosphere and when they concentrate at just the right height, they refract the Moon's light, causing it to create the illusion of a ring or halo when seen from the ground.
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As it happens, we had  snow and ice in the forecast. Â

Courtesy National Oceanic and Atmospheric Administration (NOAA).
http://accesswdun.com/article/2010/2/227271