Edit in JSFiddle

// grab the canvas element, get the context for API access and 
// preset some variables
var canvas = document.querySelector( 'canvas' ),
    c = canvas.getContext( '2d' ),
    mouseX = 0,
    mouseY = 0,
    width = 300,
    height = 300,
    distx = 0,
    disty = 0,
    hw = width / 2,
    hh = height / 2,
    longest = Math.sqrt( ( hw * hw ) + ( hh * hh ) ),
    factor = 0.4,
    realdistance = 0,
    blur = [ 2, 9 ],
    shadowalpha = [ 3, 8 ],
    blurfactor = blur[1] / longest,
    shadowfactor = shadowalpha[1] / longest;

// resize the canvas
canvas.width = width;
canvas.height = height;

function draw() {

  // calculate the distance caused by the offset
  distx = mouseX - hw;
  disty = mouseY - hh;
  realdistance = Math.sqrt( ( distx * distx ) + ( disty * disty ) );
  var currentblur = parseInt( blurfactor * realdistance, 10 );
  if ( currentblur < blur[ 0 ] ) {currentblur = blur[0];}
  var currentalpha = parseInt( shadowfactor * realdistance, 10 );
  if ( currentalpha < shadowalpha[ 0 ] ) { currentalpha = shadowalpha[0]; }

  c.clearRect( 0, 0, width, height );
  c.save();
  c.translate( hw, hh );
  c.beginPath();
  c.strokeStyle = 'rgba(255,255,255,0.3)';
  c.moveTo( 0, 0 );
  c.lineTo( distx, disty );
  c.closePath();
  c.stroke();

  c.beginPath();
  c.strokeStyle = 'red';
  c.moveTo( 0, 0 );
  c.lineTo( -distx * factor, -disty * factor );
  c.closePath();
  c.stroke();

  c.beginPath();
  c.shadowOffsetX = -distx * factor;
  c.shadowOffsetY = -disty * factor;
  c.shadowBlur = currentblur;
  c.shadowColor = 'rgba(0,0,0,' + (1 - currentalpha / 10)  + ')';
  c.fillStyle = 'lime';
  var text = 'Text with shadow';
  c.font = "bold 24px sans-serif";
  var len = c.measureText( text );
  c.fillText( text, -len.width/2, 12 );
  c.closePath();

  var grd = c.createRadialGradient(distx+10,disty-10,3,distx+10,disty-10,40);
  grd.addColorStop(0, "white");
  grd.addColorStop(1, "orange");
  c.fillStyle = grd;  
  c.shadowColor = 'rgba(0,0,0,0)';
  c.beginPath();
  c.arc( distx, disty, 20 , 0, Math.PI*2, true );
  c.closePath();
  c.fill();
  c.restore();

}

// get the mouse position on the canvas (some browser trickery involved)
canvas.addEventListener( 'mousemove', function( event ) {
  if( event.offsetX ){
    mouseX = event.offsetX;
    mouseY = event.offsetY;
  } else {
    mouseX = event.pageX - event.target.offsetLeft;
    mouseY = event.pageY - event.target.offsetTop;
  }
  // call the draw function
  draw();
}, false );

<canvas></canvas>

*{margin:0;padding:0;}
canvas{background:#69c;}