Next I filled in highlights and shadow using a few different layer styles, mainly overlay, color dodge and hard light. I selected the fills for the characters and blurred the highlights inside of them, so they would be soft but still have a hard edge on the outline. I also applied some photo texture patterns to the character's clothing.
Make sure to check out Feng Zhu's work, he also has some great video tutorials that you can find here.
Another always great resource is traditional painter James Gurney. I learned most everything I know about realism from his incredible book, Color and Light. Seriously, buy it, it's worth more than four years in art school. He also has an informative blog that he updates regularly.