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Open up the paper texture. Drag and drop the texture in to the design. Place it at very bottom in the layer stack.
Flip the texture first vertically then horizontally.
Take off the color from the texture. The simple shortcut is Ctrl + Shift + U. You can achieve the same result by using the Hue/Saturation dialog box and reducing the saturation to -100.
Increase the lightness of the texture using the Curves dialog box (Ctrl + M). Adjust the black point, white point and mid tones of the texture.
Open up the half tone textures in Illustrator. Copy the texture you see here!
Head back to Photoshop. Press Ctrl + V to paste the texture. Place it below the shape layers and above the texture layer. Resize it accordingly.
There is a part of the texture I want to hide. Use the layer mask to do this. Add layer mask to the texture, select the part using Lasso Tool. Click on the layer mask and fill the selection with black.
Now bring in the paint texture (Watercolors pack, 030.jpg). Place it above the halftone pattern. Resize the texture.
Hide unwanted areas using a mask.
Add and Curves adjustment layer to the water color texture. At the bottom of the Layers palette you can see a small black and white circle. Click on it and select Curves. This will create an adjustment layer of curves just above the texture. Adjustment layers lets you work in a non destructive manner. You can adjust them, disable them or just remove them at any time. After you edited the curve, there is a tiny button on the adjustments panel at the bottom. Click it to clip the adjustment layer to the texture below.
The texture has a white background and we need to remove it somehow. So at this point we can take advantage of the Photoshop's advanced blending feature. To access it double click on the layer. Layer Styles dialog box will pop up. In the Blending Options category you can locate the "Blend if" section at the bottom. This is where everything is going to happen. All you need to do is press down "Alt" key, click on the little white handle and move your pointer across the little gradient ramp towards your left. You can see the result in the background. When you feel it is looking good click OK