Notes:
The techniques used in this tutorial can be used in most programmes. I myself use PSP 7.
Ok, this kind of hair shading style works best with smaller sized dolls. Also, I don't usually use a hair palette, but I'll give you the colours I've used for this tut. Usually, I just pick out the colours as I go. If any look too dark/light at the end, I use the Colour Replacer tool in PSP to change them.

Step One - Outline
First things first. I make a basic outline. For this style, I try to keep the top of the hair in a similar shape to the top of the base's head. Unless it's a really wierd shape. Basically, it needs a nice roundness to it. Nothing too jagged. As for the bottom of the hair, this needs to be jagged, lol. A straight line just looks unrealistic. Just make random triangular-ish shapes at the ends of the hair.

Step Two - Dark Shading
For this step, I pick a slightly darker shade than the outline. I go over the parting, as well as adding a few strands. Also, I put some close to the neck and add a couple of strands there. If the hair is tucked behind an ear, don't forget to add some of the darkest colour there as well. Basically, this shading goes where the hair would be darkest.

Step Three - More Shading
This shading follows on from the last step. Go round where you've shaded with the first colour, with a slightly lighter shade. Then, add a few more strands. I added some where the hair is getting tucked behind the ear, to make it look a bit more realistic. Any strands near the parting should follow the lines made by the darkest colour.

Step Four - Filling in
This step's easy! Just get a lighter shade, and fill in the hair :D

Step Five - Highlights
Ok. Time to start the highlights. Follow the shape of the hair when doing this. Rather than highlighting a block of colour, I make a few lines, which will look like 'strands' of hair. Don't worry if the strands meet at some points (as long as they don't make a big block of colour). Also, don't worry if this colour touches one of the shading colours.

Step Six - More Highlights
For these highlights, I don't even use lines. Following the lines of the first highlights, wherever light would hit the hair, I put this colour on every other pixel. The picture may help you understand what I mean! I do sometimes follow a whole strand down, filling it all in, just to give the rest of the hair more colour. In this case, I've followd the higlight on the left side of the hair (See pic).

Step Seven - Yet More Higlights
Use the lightest colour very sparingly. It goes in the middle of the last set of highlights at the top of the head... (does that make sense? lol) This step makes the hair look shiny :D So, if you're looking for not-so-shiny hair, you can miss this step out.

Step Eight - The Outline and Tweaking
Almost done! This step isn't neccesary, but I find it helps. One of the last things I do is change the colour of the outline. I darken it slightly near the parting, and make it slightly lighter near all the rest of the major highlights.
Also, I add some shading to the skin, under the hair. This just makes it looka little more 'attatched' to the head of the doll.
Any tweaks that need to be made are made in this step. For example, with this doll, I made the hair near the neck and under the ear look a little darker by adding more of the darker colours.

Step Nine - Step back and admire the pretty hair!