The steps are really very easy, but I'll go through them anyway. You're going to need a nude nail polish, I used Maybelline Everstrong in Ivory Rose (£4.09, here), a base coat, I used Save the Nail Repair and Rescue Base coat as my nails are quite weak (£7.50, here), a french white polish, I'm using Collection 2000 French Manicure in French White (£2.99, availbile from Boots and Superdrug, but irritatingly not online) and a topcoat. I'm using Seche Vite Dry Fast Topcoat (£10.50, here), a nail file and/or buffer, a makeup sponge and some sort of non-porus surface, I just use old packaging.
Apply your nude polish, using enough coats for it to be opaque, though if your nail line shows it doesn't matter too much.
Using a matte topcoat can make the gradient even more fuzzy and soft looking, it's a really pretty effect.