Earthquake pattern in Iceland on Aug 17, 2014 (Iceland Met Office)
A closer look at the site seems to show that the activity is due to magma movement, and there is an ongoing ground swelling which supports this.
Closer look at the eruption pattern (Iceland Met Office)
Jón Frímann has been watching the site and has a more detailed description of what the instruments are showing. Note that the activity is under the ice cap, so if it breaks through this may well contribute to the size of the particles generated, and the resulting size and path of the debris cloud.
I will update below the fold if this situation gets worse.
UPDATED Aug 18th, twice since the Icelandic Met Office have now raised the warning to orange. (h/t Jón Frímann)
One day later and, depending on your point of view, the quakes are getting more focussed, or the activity is beginning to settle down. The stars denote quakes that are larger than 3.0, though these two barely make that distinction, and there is one around each of the foci of activity.
Figure 3. Earthquake activity August 18, 2014 (Iceland Met Office)
UPDATE 2 at 4:30 pm
As noted above the fold, the Icelandic Met Office has noted the increasing levels of activity and has upped the warning for the region to orange, which means:
ORANGE: Volcano shows heightened or escalating unrest with increased potential of eruption.This is only superseded by RED, which occurs when either the eruption is imminent or already happening.