If you're using your pc, after you hit reply, in the tool bar you'll see a square icon with the picture of a tree. If you hover your mouse over that icon it will say "insert image". When you click on that it gives you the option of inserting an image "from url" (which is what you seem to be doing) or "from your computer", (which is what you should be doing). Click on "from computer", then "choose file". From there you can choose the picture located on your computer. Then click on "upload file". There ya go, easy peasy.

Good luck
tap'n