Please Enable Watermark type : Images first. To enable go to Control panel -> Custom settings -> Tick the "Apply a watermark to uploaded images" and Choose watermark type : Image and provide the image to link of the image.
U think Common settings? I'm already talking about this if u also think about exactly this option.
BUT when I choose watermark type - option after 1 second goes unavailable and at the bottom right side information window says : "Available for premium users only" ..