Add a new layer called Highlight.  Click on your preset shapes tool (ellipse) and use the following options (in PSP7 have both your colors set to white):

(I added a transparent layer below my image layers for the following two pictures to allow a better view of the sparkle and highlight.)

Now, draw an ellipse on your goblet, as shown:

Now apply a Gaussian blur of 6.

Now would be a good time to save your image!! 

Add a new layer called Sparkle.  Make this layer active and add a sparkle or two to your glass for highlight.  I used Hood's Sparkle tube, included in the zip file you downloaded earlier.  Size 50 for the top rim and size 30 for the base.  

Now we need to blend our shadows.  Make your goblet layer active and using your magic wand, click anywhere outside your goblet. Now invert your selection (Shift+Ctrl+I) or Selections/Invert.  Make your color layer active and make your Goblet, Highlight, and Sparkle layers invisible by clicking on the eyeglasses in your Layer Palette option tool box.

Now zoom in on your image in two areas: the top of the stem and the base, as shown below:

We want to blend these shadows.  By having only the "goblet" section of your image selected, you won't smear any of your color outside your "goblet" area.  Using your retouch tool with the following settings, blend the shadows in these two areas.

If you don't have your ruler showing: View/Rulers or Ctrl+Alt+R will make it show up.  I started in the center of my stem at the 160 pixel mark on my side ruler, then dragged my brush up about 20 pixels; repeat for the left and right side, moving toward the outer edge of your goblet.  Then start at about 155 and drag up about 10 pixels. Lower the opacity to 25 and starting at approximately 140 blend the top shadow again until you are happy with it.  Play around with the opacity and keep "pushing" your colors until you are happy with the blending effect.  You can also try pushing from the top down, if you get too much of the gray up into your goblet.  Repeat for the bottom of your stem, flaring out into the base of your goblet.  

Now would be a good time to save your image!! 

With your "goblet" still selected, make your Goblet layer active and make all other layers invisible.  We are going to fine tune the detail now.  Using your eraser tool completely erase the line across the base of your goblet "cup", the area in read below:

Now, erase the line across the bottom of your stem, the area in red, below:

Now, change the opacity on your eraser tool to 85 and erase the "sides" of your stem which run into the base, as shown in red, below:

This will leave just a shadow of the bevel.  Be careful to only go over the line once, to keep the opacity even.  If you're a little unsteady (like me) you can just click pixel by pixel, which is how I did it. Now deselect.

Let's clean up any stray pixels.  Make all layers visible.  Drag your goblet layer to the top and make this your active layer.  Using your magic wand, click anywhere outside your goblet.  Activate your color layer and hit delete; do the same for the highlight and sparkle layers.  Lower the opacity on your goblet layer to 15 and save the file for a basic goblet.

Now would be a good time to save your image!! 

On to part 3...... 

PART 3

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Revised: April 06, 2008.