Need help please

Hi I am using Psp9 and I also have a downloaded version of photoshop cs2 but lately I have been wanting a new layout for my livejournal. Once I had the header for my livejournal created I realized that I really wanted to get the effect of my header fading into the background color of my livejournal. The only problem is I can't figure out how to do this. My background color for my livejournal at this moment is black and my header's overal color is sort of a peachy purple. I tried using PSP9 and using the feather option to see if the edges of my header would fade when I pasted it as another layer on the black but there is still the hard line so it looks like a picture just ontop of a black area. Does anyone know how I can use a program or something to make it so that my header picture will fade around the edges into another color? Thanks.

Here's a picture of my header under the cut.