Ok seems now you can upload directly your pictures to Steemit with the "Drag and drop or select item" in the editor when you post.
This article is one year old, and apparently it wasn't possible at that time. Now it is.
Proof in 2 of my posts :
https://steemit.com/art/@eternalsunshine/a-nice-black-and-white-ink-pen-hand-drawing
and
https://steemit.com/colorchallenge/@eternalsunshine/4eseup-color-challenge-yellow
So, no need to host externally :)
RE: Adding Images To Your STEEM Posts