The lights made with round brush, shape dynamic adjusted to an oval. Here are the settings for brush scatter and color dynamics. I painted one layer conforming to the tree then copied it 3 times applying a slight Gaussian blur to one layer and another layer's blend mode was set to screen. An adjustment layer for exposure was clipped to the layer set at screen blend.
step 3 of 6
The bulbs are circle shapes with various colors. The hanger is a rectangle filled with a gradient. The bevel emboss FX applied to each.
step 4 of 6
Shadowing and lighting effect beneath tree added. The snowflake shape used for the ornaments and tree topper is from CS5. Some extra lights created with the star brush and assorted colors on separate layer blend set to screen.
step 5 of 6
Added background. Played around with hue/sat and photo filter.