Start a new document, mine is 200px by 200px.

Use the ECLIPSE shape tool - HOLD DOWN SHIFT and draw a round shape on the canvas.

Apply the following layer styles to this shape:

Layer->Layer Style:

-> Gradient Overlay
-> Inner Shadow
-> Inner Glow
-> Satin

Create a new layer

Then set your foreground color to white, and select the BRUSH tool, with brush size 27px SOFT edge.

Then on this new layer, draw a white blob over the shape, creating a sparkling/shiny effect.

Now set this layer's blending mode to overlay.

Select the Rounded Rectangle shape tool

press D to reset your colors.

Set the radius to around 3 - 5px.

Then draw a verticle shape on top of the ball.

Now go to Edit->transform->warp.

Now drag the four BOTTOM handles outwards to create the shape like the picture on the left.

Then apply the following layer styles to this shape.

-> Drop Shadow
-> Bevel and Emboss
-> Gradient Overlay

Create a NEW layer

select the circle marquee tool and make an oval selection above the yellow shape...

Now go to Edit->Stroke->

Then CTRL+D to deselect.

Apply the same layer style as the yellow shape above and we're done!