In my case female hormones did indeed create a sense of "fog" that was only truly visible with the contrast of masculinizing HRT.
I would describe it as a fog as well, because things are much clearer and compartmentalized now. Focus is easier. The condition before felt like there was no barrier between stimuli and emotional response, one emotion/memory would bleed into another, and there was a lot more anxiety and self-consciousness present, that would tend to interfere with my thoughts. I could think about more things 'simultaneously' and memories would be dredged up more easily with them, but my focus was poorer.
If I had to summarize, estrogen seems to allow a greater degree of connection between emotional response, memory, and preoccupying thoughts. For some this is a good thing, and a new kind of experience. For me, it was a relief for my memories and emotions not to be quite so accessible all the time, and to be able to block everything out and think about one thing only.