All my teachers have strongly suggested to never use any of the auto functions in photoshop, and one of them even used to work for adobe! But.. I admit I find myself testing it out every once in awhile and SOMETIMES you get good results. Here is what David Blatner, photoshop and quark guru says about using auto levels(excerpt from the book "Real World Photoshop"): "Auto levels is a feature we strongly suggest you avoid (unless you want an automatic way of wrecking your images). It automatically moves the black and white input sliders to clip a predetermined amount of data separately on each channel. In the processs, it almost invariably introduces major color shifts."
The histogram will give you an idea of the overall tonal range (the diagram that looks like little mountains peaks). A broad histogram is ideal (when the mountains fill the entire diagram from left to right), a narrow histogram means just that, that the tonal range is narrow. You can get force changes in the histogram by messing with brightness/contrast. (this is recommended by the Adobe Print Publishing Guide) Before color correction, pixels are often concentrated in the midtones, you want to get it spread out more evenly across the histogram. Sometimes I just move the darks and highlight arrows (the left and right arrows) to the edge of the mountains, then adjust the midtone arrow. This usually yields more contrast.
I'll see if I can put together a tutorial later but it might not be that great, I'm still learning! For a really good photoshop book with expert advice on color and tonal correction, check out "Real World Photoshop:Industry Strength Production Techniques". If you're looking for the best advice on practical stuff, stay away from the photoshop books that teach you tricks like making text look like flames or metal, and stuff like that. Those books tend not to go in depth about color correction topics.
