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When creating a rainbow, open a new document of 10,000 square pixels, just to give yourself enough space. This way, you can paste your finished rainbow onto any picture you like.
Start by going to the Gradient tool (G) and selecting the Rainbow option, with transparent sides. Create a small horizontal line just above the bottom margin, and then go to Filter>Distort>Polar Coordinates. Choose Rectangular to Polar and click OK. This will create a rainbow ring.
With your rainbow now ready to paste, Ctrl/ right-click and Transform. Use the Skew tool to make the rainbow thicker one end than the other to give it some perspective, and then place in your picture. Go to Filter>Blur>Gaussian Blur, set it to 15px, and set the rainbow layer to Screen and Opacity to 80% or lower. Mask the bottom of the rainbow to give the effect of it fading into the ground.