Gramg
Thanks for the compliment. I am retired and I have put a LOT of time in leaning the little I know about Gimp.

Esper,
Here is one possibility for the 'N'. It is not intended to be a "thing of beauty", just proof of concept.

The only thing I did was to use the free select tool to subtract from the selection after it was grown by 20px. Yes, I did a poor job with the lasso tool, and ommited some smoothing and the 2nd reflection layer, but it is an approach to defining the 'N' better if need be.

jas45: nice work on your balloon text! of course you can always tweak your letters to your liking - i usually make a path from the letter and change the path, i find that a little easier than using the free select tool.

Woah...very nice results! The pink is great, AnMal!
@all: like esper says, the font is importend. You can other fonts, but shrink/grow is not the same.
I use red cause the reflections are better on darker colors. If you use yellow the reflections opacity is different.
Molly: I try your xcf-file. It is all right on this. You must fill the shrinked selection with black on the layermask.
Then unselect it and use gaussian blur. Thats it.
Of course, you must turn off the blur layer!

On the screenshot i make a copy of the balloon layer so you can see the steps, i hope.

Hi, Chris not easy . Also Gimp crashing a few times made it interesting. For some reason , I could not get meaningful results with the alpha to color (black). I tried with black and gray (as the color to alpha) and adjusting the alpha layer curve but it did not give good results so I fudged the effect with add layer mode and a 5px gaussian blur on the reflection layers. Anyway here is my result. Thank you for going to the effort of making this tutorial. I enjoyed the challenge. Font is "babycakes" which I stretched with filters/text/freetype. I hoped that it may have given a bit more definition on the N and S but there is not much difference from your "cookies" font. Total time about 5 hours.

very good wooble.

nice molly, i think you should turn down the opacity of the highlights

the idea with the gradient on the strings is a good one !

i have never seen balloons that are transparent in the middle, thats why i added a semi transparent layer behind my balloons

I agree with esper...real balloons are not transparent.
If you want more opacity in the middle you can simply change the layermask.
My screenshot shows the mask is much brighter.

An other color variation with a layer filled with smooth plasma.

Chris F: I love the plasma balloons! looks better with more opacity too.

I agree, they do look better.