After this step, this is your image:

4.Then apply this texture. Set blend mode to Softlight.

5.Use this texture. Set blend option to Lighten. Then apply Layer Mask on this layer.

6.Still working on this layer. Choose Gradient Tool (G)

I choose that direction. You can choose another direction to drag. It’s up to you.

Then you will have something like this:

7.You can stop at step 6 or move on. Open a picture of a daydreaming girl. I choose this Chinese girl. Separate her from background and drag her to the picture by Move Tool (V). Her layer must be under 2 selective color layers and 2 texture layers.

8.You can stop here and add brushes and texts if you want and done. But I continue here. Go to Layer/New Adjustment Layer/Curves and set two points in the RGB setting:

It will turn darker.

9.Create a Selective Color Layer again with these numbers:

And we’ll get this. It doesn’t change much the color, it just makes the picture darker. So you can miss this step if you want.

10.Apply Waves Brush to a layer with blend mode is Softlight and Opacity 80%. Then go to Layer/Layer Style/Outer Glow like image below

11.Now, to smoother the girl, I duplicate the Chinese girl layer, set blend mode to Softlight. Next, choose the original layer, go to Filter/Blur/Gaussian Blur and set radius about 0.4 to 0.9. Now I have.

Add some texts and brushes to your work

And here is my final result. (click on the picture below to see full size)