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