The 'blue thing' is actually because parts of the sphere leave the camera's vision range and so aren't rendered anymore. What you're seeing is the blue background that's normally present coming back into view. You can either make your sky sphere smaller (I think that 3000 units is the default maximum view distance) or you can change the viewing distance by use of the "set camera range" command.
However, don't set the view range too high, or it messes with your z-depth. This basically means that objects far away might start appearing 'over' objects that are close up, and vice versa.
Hope this helps!
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