The sentence seems to show the contrast between the sky falling and the moon going up, and that might be a factor in the acceptability of the ellipsis?
That may be, Yasukotta. To me, the reason the ellipsis works so well in that example is that, without the ellipsis, it would be unclear whether "the moon (might) go up in red fire" was the second conjunct of the "that"-clause complementing "feeling." It could be mistaken for another independent clause.
I'm not sure, but I really appreciate your kindness to offer this instance. I would like to know if there is any reference book discussing this type of ellipsis.
There are a number of advanced syntax books and articles dealing with Gapping, but I know of none devoted to the type in which the modal of a conjunct clause is the sole element elided. It may also be possible to analyze this as a special type of coordinantion, without considering it ellipsis proper.
In any case, below is yet another literary instance I have come across of the phenomenon. This is the third stanza of John Keat's poem "Ode to a Nightingale" (1819). The example occurs in the final "where"-clause, which contains two conjunct clauses, the second one not including "cannot":
"Fade far away, dissolve, and quite forget
What thou among the leaves hast never known,
The weariness, the fever, and the fret
Here, where men sit and hear each other groan;
Where palsy shakes a few, sad, last gray hairs,
Where youth grows pale, and spectre-thin, and dies;
Where but to think is to be full of sorrow
And leaden-eyed despairs,
Where Beauty cannot keep her lustrous eyes,
or new Love pine at them beyond tomorrow."
- John Keats