Meaning: The cloud moved smoothly and easily through the air or water in the upper part of the atmosphere that we see above us, and it had the color of the clear sky or the deep sea.
Choice of Words: Floated is the past tense of float, which means to move smoothly and easily through the air or water. Blue means having the color of the clear sky or the deep sea. Sky is the upper part of the atmosphere that we see above us.