Obviously, the main thing to consider when you shoot pictures for a panorama is that you should hold the camera steady at one height. Don't take it away from your eye while you're shooting. If you get interrupted mid-sequence, start again. Better yet, if possible, use a tripod to keep the camera steady. Remember, digital photos don't waste film. Stay away from the focus and zoom buttons. Auto-focus the first picture and let that one dictate the focus for the rest.
Practice the "panorama shuffle." Start shooting with your body aimed at one end of the scene. Take small steps circling to your right as you shoot your pictures from left to right.
Don't use a flash. Particularly, don't use auto-flash, as it will throw varying amounts of light as it sees a need. These make the exposure all but impossible to correct. If your camera allows, turn off auto-exposure and choose a suitable exposure value for the available light; you can try a couple of test shots and preview them on your LCD to check the value.
Use a normal lens for best results. Set your zoom lens about halfway between zoom and telephoto, and leave it there. Don't use a wide-angle or fisheye lens. Such lenses defeat the purpose of the panorama, which is to have everything in the same focus and not distorted. Nothing distorts more than a fisheye.
Make sure you have enough overlap between pictures, but not too much. Somewhere around 20% is good. As you pan across the scene, remember what is on the right side of each picture you take, and just cover it again on the left of the next shot.
Take a picture of something clearly different between shooting panorama sequences. That way you won't try to assemble pictures that don't go together. Keep each set of pictures in a separate folder as you download them from the camera.
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Although we usually tend to think of the digital camera as the best thing since sliced bread, there are both pros and cons with its use. Nothing is available on the market that does not have both a good and a bad side, but the key is to weigh the good against the bad in order to come up with the best of both worlds.