Blending layers without masking: http://creativepro.com/mastering-photoshop-smart-objects-blending-layers-without-masking/

• Layers option – in gray mode, change opacity of layer
  • Split slider to make smooth transition
• Convert to smart object – take out black background to do outer glow
• Blur layer with Gaussian blur of one pixel
• Screen blending mode for layer
• Blending options for underlying layer
• Animate with timeline to move underlying layer of clouds