It’s a little complicated to explain but I can try. I use Photoshop CS5.
Get the cap, resize it/crop it and then duplicate the layer. Screen the duplicate and then use the Gaussian blur filter at 13.0. Then go to the eraser, set the opacity to 49% and erase the parts you don’t want glowy (I usually erase the face/skin/clothes areas). Then add whatever PSD or coloring you like.
I hope that makes sense/helps :)