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'Hovering ship' photographed off Cornish coast by walker
An illusion called "superior mirage" caused the vessel to look like it was hovering above the sea.

The article says objects beyond the horizon can appear below the horizon too.
Yes. And there's a theory that there was a false horizon, caused by the Labrador Current, that effectively hid the Titanic iceberg from sight until it was too late. And, for the same reason, the Californian (which was very close by and which failed to respond to their distress rockets) may not have had the clear sight of them that was claimed.It's just basic physics. Have a read of this: https://www.physicsclassroom.com/class/refrn/Lesson-4/Mirages