How to make watermark image?

I simply can not figure out how to make a text image with transparent background, that does not show a white dither fringe once it is utilized by this plugin. Any tips? As close as I got was making a .png with black text and transparent background, but once that’s used by this plugin and placed in the image, it shows annoying fringe when on darker part of underlying image that is watermarked. Frustrating, as the plugin seems to work ok and I really need something like this. MTN