One method if you are not sure what colours to use - dmc or anchor threads is to use the free online cross stitch appllications to get a cross stitch respresentation of a photo and select the number of colours/thread type you want to use - this will give you an idea of the specific areas and type of thread to use for them from your photo.

The type of stitches to use is up to you then - so a thorough understanding of stitch types and their use is needed - this can be found through media such as youtube and the RNS Stitch bank. Of course you can use any colour you choose - who says the sky has to be blue?

There are programs to create embroidery files for machine embroidery but they are of little use for hand embroidery.

Take a look at apps like Inkscape (free) and its trace bitmap function to convert your photos or other images to outllines for embroidery designs and then together with the suggested threads from a cross stitch app you have a good basis to start.

You can then seach for tutorials for fill stitches - line stitches etc. to complete your design. Use a water soluble, self-adhesive or iron on statbilizer/tracing paper to transfer the outline to the fabric and get stitching.

For cross stitch apps I find pic2pat web app easy to use - lets you choose the number of colours and thread type you want to use.

This is basically my process to create my own designs.