DO NOT save pixel art as a .jpg
it is the pixel artists law
Edit: heres a little tut that took me 12-15min to make.
ok lets begin "students"...
Note before starting: When designing pixel art, it is highly reccomended that you use a template (I.E. a set of prepared colours) it saves time and gives you a basic outline of what colours your going to use, and if you need more shades it gives you a basis for those shades.
1 You want to start with a basic sword concept, mine is a little well more complex...
2 Add some basic details, I.E. lines suggesting cloth wrappings, cloth hanging off the sword handle or blade or wherever...
3* If you are planning on adding an effect, (in this case, fire..., use this step), start by drawing an outline of the area of the main body of your effect (draw around the sword.) then add little extra whisps for increased effect (not necessary, helps alot though)
4. This extra detail i'm adding makes it seem as if the sword is causing the effect around it. I start off by filling (bucket tool) the blade of the sword with a light grey. then i add the begining of a bunch of cracks on the blade (eventually to become lava-ish stuff)
5. & 6. continue adding some lighter shading to the lava cracks and slightly (not by much) make the lava cracks bigger by maybe 1-2 pixels depending on the weapon.
7. Remove the light grey background of the blade.
8. Make a copy of the sword without
its lava cracks, and I personally use an older style of blade shading, which makes the metal look a little flatter, but if you dont like that you can always follow the lower halves of steps 8-12. To shade this way, begin by making a slight design (much like the shape of the blade) with your darkest metal colour and bring this up about 1/3 to 1/4 of the blade's hight. Do the same with your other metal colours. For the lower halves, follow the same steps but when finished erase a line along the edge of the swords outline on the side of the blade that the light is hitting.
9. Copy the Lava design onto your metalic blade.
10. Shade the handle of the sword, and taking any colour (used metalic colours), if your using cloth on the handle shade the cloth similar to the blade shading but DO NOT add the white line no matter which style of shading you're using.
11. Shade the Effect (in this case, fire) much the same way as you did the lava cracks, start right up against the blade and slowly and slightly move away from it adjusting the shading as you see fit, if you need to zoom out every once in a while, it helps to gauge whether you're shading the effect just right.
12. Now add an outline following the shading of your effect (where its darkest use a darker colour, lightest use a lighter colour) and then you're DONE.
Note: Now I didnt shade the fire effect exactly the correct way, but how i shaded helps to show, how to shade fire in general.