Finally got watermarking to work!! now i need a picture!

so i finally got the watermark feature to work in gallery. now it makes me feel retarded when i realized how easy it was. the problem i have now is how to make a nice transparent picture (the watermark) to place over the pictures. i tried using a nice solid text and it worked as it was supposed to. then i made a gif image using ps cs and made the text transparent and added embossing to it. when i tried to use this pic as the watermark it wouldnt work. anyone know of any other ways to make a transparent watermark?

A slight word of warning - using the automatic watermark feature in gallery reduced my image quality substantially. I ended up deleting everything and inputting the watermark in ImageReady to retain the images' quality.