Its angular size changes only a little
The Moon’s apparent diameter is about half a degree in the sky. It changes over the month because the Moon’s orbit is elliptical, but the dramatic “giant Moon” feeling at the horizon is not caused by a sudden physical enlargement.
Foreground gives your brain scale
Near the horizon, the Moon sits beside trees, houses, hills, towers, and the visible landscape. Your brain interprets that context differently than it interprets an isolated Moon high in an empty sky. The result is a powerful size impression.
The atmosphere changes color and sharpness
The low Moon often looks warmer, dimmer, or more distorted because its light travels through more atmosphere. That atmosphere can redden the Moon and soften detail, but it does not magnify the Moon enough to explain the illusion.
A simple test
Photograph the Moon near the horizon and again when it is higher using the same lens and zoom. The disk will be close to the same size in the image, even if your eye remembered the horizon Moon as much larger.
